2011-07-17 Announcing the WikiLeaks Central Essay Competition Winner

The winner is:

Continued improvements in technology will eventually render the State obsolete.
by xaviercromartie

We would like to make clear that the judges are not 'endorsing' the underlying philosophy of the writer by announcing a winner. What we liked most about the winning essay was the writer's ability to clearly describe the relationship between the seemingly anarchical state of the Internet and the centralized structure of the state proper vis a vis the individual. We believe the writer successfully rendered the topic relevant and worthy of further discussion.

The judges felt that many of the submitted essays lacked sufficient data, sources, or exposition to support assumptions and claims found therein. The judges also felt that many of the submissions, while good, were not chosen, because they did not answer the question:

How can individuals and societies protect themselves against the encroachment and abuse of government power in the modern age?

The essays were judged on (i) newsworthiness; (ii) supporting research; and (iii) organization and writing style. (iv) We also considered the essay's capacity to engender online discourse in the form of comments and retweets.

We would like to make special note that the judges appreciated a point presented by another finalist in Freedom and Moral Right are Inseparable:

"Technology can't provide much more than a way to communicate and spread thoughts and ideas. The old and ridiculous notion that 'technology will save us' simply isn't, nor can it ever be, true and human nature has to be considered which isn't mechanical or automatic. The “dual use” of technology has insured our slavery to the lack of privacy and the loss of freedom to every manner to surveillance."

Despite our prima facie assumption regarding technology's cardinal role as liberator, when discussing freedom and democracy, it would seem, one cannot avoid discussing the role of ethics and perhaps even the existence or nature of wisdom itself.

Two other essays deserve special mention. They are Engineering Resistance: From the Triangle to the Circle and Empowering the Individual - The Answer to Tyranny.

Thank you again to all the authors. We enjoyed reading your work.

Competition Entry | How can individuals and societies protect themselves against the encroachment and abuse of government power in the modern age?

How can individuals and societies protect themselves against the encroachment and abuse of government power in the modern age?

By anonym

Gesellschaft motivieren, sich gegen Machtmissbrauch des Staates zu schützen Noch nie war es so einfach wie heute sich zu informieren. Durch Internet hat jeder Bürger nahezu kostenlos Zugang zu fast grenzenlosen Informationen.

Dennoch ist ein Großteil der Gesellschaft so wenig politisch interessiert und folglich so schlecht informiert wie wahrscheinlich keine Generation davor.

Die Macht, die die Gesellschaft theoretisch durch den Zugang zu massenhaften Informationen hat, wird nicht genutzt und vermutlich noch nicht einmal wahrgenommen.

Es ist den Medien gelungen, die Aufmerksamkeit der Gesellschaft vollständig auf die Sparte Klatsch und Tratsch, Triviales und Sport zu lenken und die Bedürfnisse nach Information damit zu befriedigen. In einer Demokratie sollte die Gesellschaft und die Medien durch kritisches Hinterfragen ein Gegengewicht zum Staat und der Wirtschaft bilden, so dass Machtmissbrauch des Staates und der Wirtschaft verhindert oder deutlich erschwert wird.

Dieses Gegengewicht ist durch die politische Gleichgültigkeit der Gesellschaft und durch die Oberflächlichkeit vieler Medien nicht mehr ausreichend vorhanden. So glaubt z.B. der Großteil der Gesellschaft, dass in den TV-Nachrichten auseichend objektive und neutrale Informationen vermittelt werden. Dadurch wird es dem Staat einfach gemacht seine Macht zu missbrauchen. Es kommt zu Verquickungen zwischen Staat, Wirtschaft und Medien. Der Machtmissbrauch des Staates wird von der Gesellschaft nicht oder sehr spät erkannt. (Beispiel: So wurde in Deutschland gegen das Bahnprojekt Stuttgart 21 erst nach Baubeginn demonstriert.). Wie können sich Bürger und die Gesellschaft gegen den Machtmissbrauch des Staates schützen?

Die Gesellschaft muss zuerst motiviert werden und die Notwendigkeit erkennen, sich zu schützen.

Diese Motivation könnte erreicht werden, indem an aktuellen Beispielen aufgezeigt wird, wie stark und weitgehend Wirtschaft, Medien und Staat mittlerweile verwoben sind und welche Gefahren dadurch für die Demokratie entstehen. Diese Informationen sind im Internet und in politischen Büchern (vgl. A. Goodman für USA etc.) vorhanden, müsste aber möglichst plakativ und eingängig aufbereitet werden und entsprechend „vermarktet“ werden, damit diese Zusammenhänge von dem Großteil der Gesellschaft wahrgenommen werden.

Wenn dies gelungen ist, könnte eine Mechanismus des Kritisieren des Staates und Einfordern von Informationen von den Medien durch die Gesellschaft in Gang gesetzt werden, der letztendlich dazu führt, dass sich die Gesellschaft so selbst vor Machtmissbrauch des Staates schützen kann.

Competition Entry | A Modern Social Contract.

How can individuals and societies protect themselves against the encroachment and abuse of government power in the modern age?

By Bradley Bowman

When a government abases the social contract that protects natural rights and prosperity without the consent of the governed, a new contract must be made.

For the first time in history, the communication of information flows indiscriminate of class or culture. The modern age has witnessed the impact in the Middle East where individuals and societies continue to rewrite their social contracts against their former governments. It is within the social media groups, the hacktivists, and the protestors of impoverished nations that power shifts from the privileged few back to the protection of the people.

In a recent interview with two Anonymous operators, the administrators stated that the group was not represented accurately by the mainstream media. “ 99% of Anonymous aren’t hackers at all. They are just normal users,” said one operator, “People that care and are sick of the system.”

People go on the irc client, irc.anonops.li, for mostly social reasons and network with each other for active protests. If interested in “joining” Anonymous, go to the IRC address and join the channel #opnewblood to learn more about becoming active as a protester, supporter, or to become more informed on current issues pertaining to government abuses. Most people can contribute to the cause just by spreading the word. From Anonymous’ perspective, the power of an idea can change the world.

One member sent a link to a video of a protest at Scientology Church in
Edmonton. See http://vimeo.com/798098?utm_campaign=embed&utm_source=798098. Anonymous members stood outside the building in Guy Fawkes masks and held up signs of protest denouncing it as a cult.

It is also almost inaccurate to call it an organization. It is a collective of people from many different backgrounds. One operator quoted a well known saying on the boards that sums up their position of protest. “The establishment is invincible. Protesting is useless. You'll never change anything. If everyone in the world believed that, then every single country in the world would still be kept in poverty by a ruling monarchy. That's a fact."

Although it is specifically for Anonymous, the IRC client is a form of social media. People exchanging ideas and information and ultimately connecting. Connectivity allows a user from Texas in the U.S. to communicate and follow a citizen or journalist in Daraa, Syria on Twitter. Violence captured on a citizen’s mobile phone camera could be leaked out despite the governments denial of killing its citizens. This happened several times to news outlets like Al Jazeera’s The Stream program where audience members were able to send the videos in and raise awareness on the issue. Since then, Syria has been punished by sanctions and the people there know the world is watching –that they are not alone.

The greatest protection an individual or society can have against the abuse of power by a government is the free flowing communication of information in this modern age. Citizens of the world can interact across borders, oceans, and ideologies. Governments, financial institutions , abuse of power by law enforcement departments can’t hide their injustice when the whole world watches.

Competition Entry | Bradley Manning for President?

How can individuals and societies protect themselves against the encroachment and abuse of government power in the modern age?

by Timothy Lawson, http://timothylawson.tumblr.com/archive

“The very word “secrecy” is repugnant in a free and open society; and we are as a people inherently and historically opposed to secret societies, to secret oaths and to secret proceedings.”

Kennedy’s words are true today.

In a historic address to the American Newspapers Publishers Association ANPA in 1961, President Kennedy outlined the contradictory nature of the need for secrecy in matters of national security and the need for greater public access to the machinations of government. The ideals of free speech and a free press are enshrined in the American national consciousness.

The concern expressed by President Kennedy in his 1961 speech is just as valid and relevant today as it was fifty years ago. Two recent chains of events have bought this issue to the forefront of the media spotlight; the actions of Anat Kam and the alleged actions of Bradley Manning.

The current furore over the Wikileaks scandal bears many similarities to the Anat Kam affair. Kam, the young Israeli journalist, was accused of stealing over 2,000 military documents and leaking them to Uri Blau – a reporter for Israel’s oldest daily newspaper, Haaretz. Her aim was to expose war crimes committed by the Israel Defense Forces (IFD) in the West Bank.

Manning, a young US soldier, was charged in 2010 with the unauthorised disclosure of classified information; he is currently being detained in solitary confinement at the Marine Corps brig. He is scheduled for a pre-trial hearing in May 2011, according to *The Guardian*. His aim was to expose war crimes he encountered during his military service. Manning has been accused of leaking the highly controversial Iraq War video which showed the killing of several Iraqis and two journalists via three air-to ground strikes carried out by two US Army AH-64 Apache helicopters in Al Amin al-Thaniyah, in the New Baghdad district in Baghdad.

A major issue of contention raised in both cases is the lax security that allowed junior military personal to access highly classified, and sensitive, military information.

Manning was stationed with the 2nd Brigade Combat Team, 10th Mountain Division at Contingency Operating Station Hammer, Iraq. This posting gave him access to SIPRNet – the Secret Internet Protocol Router Network: used by the US Department of Defense to transmit classified information.

Kam has been accused of stealing the documents during her two-year compulsory military service, between 2005 and 2007, during which she was working in the office of the commander of the Central Command, which is responsible for the West Bank.

Justice Zeev Hammer, who presided over Anat Kam’s court hearings, described the security failures at the GOC Central Command chief’s office as “astounding” adding that he was “shocked to learn of these incomprehensible failures and negligent data protection”.

There are many that see the actions of Kam and Manning as treasonous.

The Monash University paper that I edit, Lots Wife, was fortunate enough to speak with Greer Cashman, an Israeli journalist from the Jerusalem Post, and a board member of the Jerusalem Journalists Association (JJA), who stated: “I’m the only person with a dissenting opinion on the board – whom all support Anat Kam’s actions – and here’s why; at the time she copied the classified information, she was a soldier and not a civilian; therefore her duty was to the military, and to the security of Israel. What she did was tantamount to treason.”

Former US ambassador to the United Nations under the Bush administration, John Bolton, said that if Manning did leak the intelligence he should be charged with treason. “Treason is still punishable by death and if he were found guilty, I would do it”, Bolton said.

Counter to this view there are many who see Bradley Manning and Anat Kam as heroes; as defenders of democracy.

CBS journalist Chase Madar states: “U.S. Army Private First Class Bradley Manning has done his duty. He has witnessed serious violations of the American military’s Uniform Code of Military Justice, violations of the rules in U.S. Army Field Manual 27-10, and violations of international law. He has brought these wrongdoings to light out of a profound sense of duty to his country, as a citizen and a soldier, and his patriotism has cost him dearly.”

As elucidated by President Kennedy, the need for secrecy in matters of national security needs to be balanced against the need for press freedom. President Kennedy’s address at the ANPA also stated: “No official of my Administration, whether his rank is high or low, civilian or military, should interpret my words here tonight as an excuse to censor the news, to stifle dissent, to cover up our mistakes or to withhold from the press and the public the facts they deserve to know.” Are Kennedy’s words not still consistent with the current US ethos? If they are, then it is a serious problem whenever the government and the military cover up information in the public interest. The US military and government, as well as many mainstream media outlets reported that those killed in the Iraq War air strike video were insurgents. The video released in 2007 by Wikileaks, proved unequivocally that the people killed were Iraqi civilians and journalists.

Bradley Mannings confinement has been shown to be inhumane. A 2006, bi-partisan National Commission on America’s Prisons was established and called for the elimination of prolonged solitary confinement. The report states:“Prisoners end up locked in their cells 23 hours a day, everyday [the treatment] is so severe that people end up completely isolated, living in what can only be described as torturous conditions.” Bradley Manning has given up his life for something he believes in.

Bradley Manning for president?

Competition Entry | Cont'd improvements in technology will eventually render the State obsolete.

How can individuals and societies protect themselves against the encroachment and abuse of government power in the modern age?

by xaviercromartie

A human is, by nature, a capitalist—a producer of capital. As Frank Chodorov wrote in The Rise and Fall of Society, humans seek to satisfy their infinite desires with the least possible net expenditure of labor. Technology continuously improves over time because humans are capable of understanding nature's laws and calculating ways in which producing something today can make life easier in the future. For example, by expending the energy to produce a spear, an early human found hunting and self-defense significantly easier thereafter.

The State is not a producer; it is "a bandit gang writ large," as Murray Rothbard put it. Politics is not a science; it is simply control over other people. In The State, Franz Oppenheimer explained the origin of the State. The origin of the State is the conquest of capital-producing people. The State comes into existence entirely for the purpose of economic exploitation. The conquerors become masters and the producers become their slaves.

In Guns, Germs, and Steel, Jared Diamond supports the idea that the State arises out of conquest. Diamond cites, in detail, the example of the Battle of Cajamarca between the Spanish Empire and the Inca Empire. 168 Spanish soldiers massacred an army of approximately 80,000 Incans. The Spaniards won because they had superior technologies such as guns, cannons, and steel.

In recent times, however, people around the world have become convinced of Abraham Lincoln's "propaganda" (as Albert Jay Nock calls it in Our Enemy, the State) that 'democracy' or 'republicanism' is government "of the people, by the people, for the people." Having a democratic government is considered synonymous with 'liberty' solely because the people have the choice of who their master will be. Unfortunately, democracy necessarily entails that only the worst possible people can rise into these positions of power, as noted by Hans-Hermann Hoppe in "Why Bad Men Rule." The most electable politicians will be the ones who promise to rob society's biggest producers and take control of the most vital aspects of Society—education, agriculture, medicine, and so on.

Regardless of whether the State uses aggressive violence to physically conquer the people or hides behind the mask of "providing social services" in order to psychologically trick the people, the State is the enemy of humanity. Technology may have allowed the State to come into existence, but technology also will eventually render the State as an unnecessary relic that the people will no longer accept.

The two things over which the State demands absolute control are violence and money. The State creates an army in order to protect itself from other States, and it creates a police force in order to protect itself from its own people. The State then convinces the people that the purpose of this monopoly on violence is to keep the people safe. Likewise, the State creates its own currency — or counterfeit money — in order to enrich itself while convincing the people that the currency is safer and more efficient than free-market money, such as gold and silver.

In order to render the State obsolete, technologies must advance to the point that the people no longer accept the State's monopolies on violence on money. Fortunately, the human desire for an easier life through technology inevitably overcomes the State's desire to regulate and control. The most important technological advancements have been the revolutions in the personal computer and Internet.

The Internet is essentially a virtual, laissez-faire Society. The Internet has transformed the concept of liberty more than anything or anyone else in humanity's history. People realize that the voluntary 'phyles' of the Internet work wonderfully despite the absence of rulers with centralized power. Cybercrimes and cyberwarfare certainly exist, but these problems cannot be solved by 'Internet police' nor 'Internet militaries.' Such institutions are just as ineffective in the real world as they are in the digital world. In the digital world, individuals understand that they need to protect themselves with strong passwords and crytography. This idea will continue to spread into the physical world. People will increasingly seek effective, voluntary, technological solutions to crime as opposed to unwillingly giving power to increasingly unpopular and corrupt groups of bullies.

The State can exist only as long as the people support it.

Digital currencies have already arisen to challenge the dominance of the State's currency. The anonymity and ease of services such as e-gold and Bitcoin have clear advantages over the State's banks that are subject to draconian regulations that exist solely for tax-collection purposes. The State aggressively prosecutes so-called "money laundering" or "counterfeiting" mechanisms. (Anne M. Tompkins went as far as calling the Liberty dollar "a unique form of domestic terrorism.") But the natural laws of the world cannot be overcome, even with coercion. It is not possible to change human behavior through legislation. Technologies that make global monetary exchange quicker and more convenient will win out. Again, the State will eventually be seen as little more than a dinosaur and a nuisance that lies in Society's way.

Competition Entry | Empowering the Individual - The Answer to Tyranny

How can individuals and societies protect themselves against the encroachment and abuse of government power in the modern age?

By "Peacenik" Rick Dickinson
WorldPeaceIsComing.com

The specter of totalitarianism is looming. A cyber-backed authoritarian regime, arising from the collusion between government and other powerful institutions, forever protecting the interests of the few from the threat of a free human race. Yet the solution to prevent this dystopian future can be found where it has been all along: inside every person.

The surest way to keep out tyranny starts with a voice inside that says "I can make a difference. My voice counts. I matter!" Whatever it is that makes someone feel like this, is precisely what is needed in larger amounts. Anything that takes an individual from feeling helpless and afraid to feeling hopeful and engaged is what will ultimately set humankind free.

Of course, one invigorated individual alone wouldn't stand much of a chance against the influential entities seeking to enslave the planet. But that's where emergent technology comes into play. Now, unlike any other time in history, humans have the tools to channel independent actions from a multitude of engaged citizens into an indomitable player in the political spectrum.

Everyday, more and more people are getting infected with the empowered spirit, and, all the time, innovations arise to more effectively organize this scattered people-power into a focused force for change. Soon, if it hasn't happened already, the world's population will recognize that the balance of power is now in their hands.

With an enlightened global populace demanding accountable governance everywhere, humans will be set free to create, in the words of Paul Krugman, "a society each of us would want if we didn't know in advance who we'd be."

So what exactly promotes this empowered state of mind, that which offers protection from overbearing institutions, including governments? There are many factors, and what works will be unique to the individual, but the most pertinent self-empowering tool in the modern era is, by far, the Internet.

Access to the web offers an exciting form of empowerment: self-reliance. Malawi's William Kampkwamba was able to power his family's farm with a wind generator built using nothing but scavenged parts and a few science books as guides.

Now just imagine the doors being opened for every young innovator with access to the great equalizer known as the Internet. Thanks to the virtual omnipotence of Google, ambition and an online connection are are fast becoming all that is needed to be a success.

The Internet also bolsters another mechanism for empowering minds: the mimic factor. Like a giant echo chamber, a lot of what gets said and done is a copy of what other people say and do. "Courage is contagious" as Julian Assange says, and the more who espouse empowerment, the more it will catch on in others, sparking an epidemic of revolutionary fever.

This contagion factor also leads to another tremendously inspiring feeling - the mob mentality - which social media helps feed like fuel on a fire. Being part of a huge group is extremely liberating. When someone doesn't have to risk sticking their neck out alone, it helps break the psychological barrier of fear that often keeps people subdued.

As well, online polls, petitions, forums and social media are all digitizing democracy for the people. On top of this, the Internet offers ways for opening governments. Whether via whistleblowers like WikiLeaks or hacktivist exposés, transparency is now something to be expected and demanded from authority.

Most importantly, the Net provides the vehicle through which millions of loosely connected people can coordinate and mobilize in real time, opening up mass-demonstrations as another way to get the people's voice heard. Gradually, all of the Internet's various channels of empowerment will manifest into the ultimate weapon against totalitarianism: a functioning global democracy.

Already, signs that humans everywhere are awakening to a heightened state of mind can be seen from the Middle East to the Mediterranean. Not only have these millions-strong demonstrations given pause to elected officials, they've left the old guard - families and institutions that have reigned over the world for centuries - scrambling to prevent a permanent upheaval to the status quo.

Under the guise of fighting terrorism, file-sharing and child exploitation, forces have been clamping down on the Internet, threatening to strip it of any democratizing and empowering values, leaving it as just another tool for the oppression.

This highlights what is perhaps the most crucial aspect for defense against authoritarian abuse and encroachment: keeping the Internet unfettered and unfiltered. An unrestricted flow of information is imperative for the future of humankind's freedom.

As long as the struggle to keep a free Internet prevails, more and more individuals will awaken to join in the movement towards a brighter future. Eventually, there will be billions of empowered minds, all interconnecting instantly, and the human species will be well on the path to a more just civilization.

Competition Entry | Engineering Resistance: From the Triangle to the Circle

How can individuals and societies protect themselves against the encroachment and abuse of government power in the modern age?

By Andrew Mckenzie
http://www.dreamerrepublic.com/post/trailer--a-dreamer-republic_55.html

The laws of parliament are complicated for the same reason the National Bank makes currency difficult to print. So, people can’t figure out how to do it. The liberation of humanity is achieved only through the liberation of the individual. We need to build tools, pirate the parliaments, unleash the political conscious, and build a new democratic basis for a better future.

What does the Internet mean for politics in the West? In the Middle East, WikiLeaks, Al Jazeera, and social networking sites have been credited with putting social and democratic movements on steroids, having played a large role in bringing millions of determined revolutionaries into the streets. Closer to home, Anonymous and Lulzsec have thrived, prying at the secret corporate and military supra-structures of Western societies.

The Internet is a place for the freedom of ideas, actions, and information. We have seen the Internet profoundly improve social contact, business efficiency, and information accessibility. The Internet is unique because of its ease, structure, and familiarity. We are now beginning to see the political consequences of this revolutionary technology.

The Internet is not merely an archive of accessible information. It represents quite powerfully a representation of human reality. This reality is home to humanity's ideas, culture, knowledge, transactions, and social communication. In this essay, I argue that the Internet is evolving into a tool to liberate the individual from the alienation of our modern political systems.

Access to information and the possibility of direct political engagement into the decision making processes of Western states set the stage for a new age of human development, where the ancient triangle of hierarchy can be replaced with the circle of democracy.

The collection of more and more information on the Internet will have a profound impact on how we understand our own realities. One example of how the Internet is already changing our present reality is SWIFT data, which is a record of all the financial transaction carried out over the Internet inside Europe and elsewhere.

In our capitalist world, where everything is monetized, viewing the record of all financial transactions is like seeing a near perfect image of the power and mechanisms of modern capitalist economies. This implies that economics could quite possibly be removed from the realm of theory, because today we have to tools to see exactly what the economy is and what it does.

In a similar vein, our own digital footprint, appears to be an immortal and intimate mark of the individual’s existence, scratched into cyberspace for eternity. We cannot be sure how future generations will judge us, but they'll certainly know everything about us. They may even go so far to say we created our own virtual resting place.

In addition to the reflective possibilities, the Internet also has made the communication of ideas, even radical ones, easier than ever before. The ease and access of communication has opened new avenues for political action and organization.

The Internet makes open and democratic societies possible and implies a fundamental change to the current political hierarchy. We are at present merely observers to politics. We should demand what has been denied, namely a voice in decisions that affect our lives.

We have an informed public, unpopular government(s), and a new means of communication. If banking can be done online, so can democracy. Democracy should be more than incompetent men in suits, special voting days, and outdated and unimaginative political parties.

Canada, for example, boasts almost 17 million Facebook users. That figure represents more than the total number of voters in the past federal election. It also represents how socially connected people can be, yet how politically disconnected they actually are.

Canada is a country of 34 million, who will be governed for the next 5 years by right-wing Conservatives who only received 5.8 million votes in the last election in 2011.

Instead of calling for democratic ‘reforms’ to fix undemocratic regimes, people should initiate these reforms themselves. Mass demonstrations evidence ineffective democracies.

The inherent good of more democratic politics derives its legitimacy from the direct engagement and participation of all the people. In Canada, 5.8 million is not a legitimate benchmark, especially because a majority of Canadians oppose the government on key issues, such as war, the environment, and social justice. In Canada particularly, and in the West more generally, low voter turnout is symptomatic of the ineffectiveness of parliament and representative democracies in their current forms. Large groups of people have either given up on the process, or are shut out by ignorance.

An interesting addition to these trends is how governments are increasingly susceptible to leaks, gaffes, and criminal prosecution. We watch in surprise as an army of perverts and criminals creep out of the woodwork of authority.

The representative democracies of the West and the various international military, corporate and financial decision making bodies have shown themselves to be remarkably stable at adapting to dealing with conflict. Elections and party politics have played an important part in the struggle for democracy. However, by themselves, they do little to protect populations from the impact of capitalism on the lives of individuals or the environment.

Representative elections have improved accountability and have played a central role in progressive politics and reform over the past century. However, the more powerful Western states have been always been ruled by pro-war pro-business parties and has little success in solving poverty, achieving stability, or even peace.

We live in a time where economic crisis, war, and environmental destruction seem inevitable and unsolvable by the current order. The sustainability of these systems is also questionable. In Europe and North America, people have been abandoned and remain unrepresented by the political systems which govern them. Organizing voters is what a politician does best, not making decisions.

Every measure against the people is declared as "necessary": the transfer of billions out of the public coffers into those of the banks; the multiple fronts in NATO's imperialist wars; and unemployment and pollution are pervasive.

Our entire economic and political discourse is encapsulated in the German political term alternativlos. Without a real revolution and a profound break with the past, the current political order and its leaders will carry us down the dead end path of austerity, imperialist war, and an atomic nightmare. Elite interests, not democratic or human ones determine the key political decision making of our time. And, the class of political, military, and business elites, who hold power today, are full of criminals and criminal behavior of all types.

Is the end of Western representative democracy forthcoming? Can the Internet provide the nails? There has never existed a time when people have been so free and interconnected. As Facebook, and other sites have shown, people are not difficult to organize. The obvious step is to organize our politics in a more democratic manner, and discuss issues with purpose rather than ‘hot air’. There is no reason why we cannot build our own parliaments at a fraction of the cost.

Today, there is a striking incompatibility with the decision making structures of representative democracy and representing the wishes of the majority. What the public wants is not even considered. Important decisions are made secretly in IMF boardrooms and NATO war-rooms. This dynamic has always existed in western democracies, but now people are more aware of the gulf between themselves and their governments, and the economic system these appointed leaders seem so desperate to save.

The Western peoples should take note: Tools already exist to move the Triangle to the Circle, if we want. The only way to reach a peaceful co-existence and a more human oriented society is with democracy. The new revolutionary generation, and the inter-connectivity of their material environment should mean an end to political hierarchy. This generation will be the monkeys who learn democracy plus the Internet can bring peace and a brighter future to the world. We must each other, and no one else, in the active governance of our nations, because the present alternative is terrifying.

Leonard Cohen:
I'm sentimental, if you know what I mean
I love the country but I can't stand the scene.
And I'm neither left or right
I'm just staying home tonight,
getting lost in that hopeless little screen.
But I'm stubborn as those garbage bags
that Time cannot decay,
I'm junk but I'm still holding up
this little wild bouquet:
Democracy is coming to the U.S.A.

Competition Entry | Freedom and Moral Right are Inseparable

How can individuals and societies protect themselves against the encroachment and abuse of government power in the modern age?

By AIS

Anyone not blindly influenced by his own prejudices can't help but perceive that there is a close and inseparable relationship between the moral condition and climate of an individual and a nation and the agreeableness to liberty of a government. History is full of examples of a people being oppressed by government when the virtue of the people declines and tends toward corruption. Loss of liberty and freedom always follow the rejection of vicissitudes by a people or nation. Truth, honesty, goodness, kindness, peace and mercy are the sure and eternal supports of a free people and that a deviation from those points invariably lead to a slow and then rapid decline in the freedom of people. Conversely; lying, theft, malice, greed and killing are inimical to freedom and liberty.

Presently, one shouldn't be surprised to see the condition of the US resembling more of a police state with many of the elements of a totalitarian government in contrast to a country which was founded by a people wanting freedom. Freedom is not the right to do whatever you please but only to do that which is good and right. Good and right can only be determined from outside of ourselves. That is; we weren't born knowing exact truths- they were given to us by God who has made it very clear what right and wrong are. To be plain- no people or nation of people can ever expect to live in peace while they do those things that are contrary to revealed principles of right and wrong. As it has been said many times over, in different ways, throughout the centuries when a calamity occurs or something bad happens to a nation people have said, “all of this has come upon us because we have forgotten God and have not done that which is good”. So, in essence when a people do that which is wrong the government will be used to punish those people. It can be argued that a government isn't reflective of the people and what they are like but that the government may consist of ambitious and corrupt men and women. That is true and a very real situation in many cases. Yet, the government still reflects a fair amount of the nature of its people.

Technology can't provide much more than a way to communicate and spread thoughts and ideas. The old and ridiculous notion that “technology will save us” simply isn't, nor can it ever be, true and human nature has to be considered which isn't mechanical or automatic. The “dual use” of technology has insured our slavery to the lack of privacy and the loss of freedom to every manner to surveillance.

Therefore the most direct and successful way to secure freedom and to prevent governmental abuse is to be virtuous, vigilant and to not tolerate or rest from objection to government when it is contrary to the truths mentioned previously. Have nothing to do with the unfruitul deeds of darkness, rather expose them.

The price we pay will always be high. We have no other way but up.

Competition Entry | Shrouded in Secrecy

How can individuals and societies protect themselves against the encroachment and abuse of government power in the modern age?

By Joel Phillips, Columbia University Undergrad

The first time I heard about WikiLeaks and its mysterious rebel leader, Julian Assange, I was definitely impressed. My generation was one of the first to grow up in a world in which our lives revolved around our computers. I certainly had a reserved admiration for those cool hackers, fueled by Redbull, who could create chaos around the world – from their dark, basement lairs.

Many of us also, I believe, long for a worthy cause. Julian Assange, in a sense, embodies this image. He is a rebel who is challenging the powers that be, bringing secrets around the world to light. However, all fantasies aside, if someone truly pressed me to reveal what I really believed, I would have had to admit that, cool as he may be, governments and corporations could never function without being able to retain certain “secret” information. I’ve been in leadership roles before. Some things are just simply better not shared with the masses. That would only create chaos. Right?

Leaders and politicians around the world tend to agree with me. Even the Obama administration, which had been such an advocate for government transparency, has come out in adamant condemnation of Julian Assange and his rebel organization, WikiLeaks. Just last year, in 2010, the first big bomb exploded in Washington’s face when WikiLeaks released the controversial footage of a 2007 air strike carried out by the U.S. military in Baghdad – against civilians. When the Pentagon learned of the potential leak of this information to the public, they went so far as claiming a national security threat from the WikiLeaks website. (The Guardian, 5 April 2010)

Then in July, 76,900 documents were released about the war in Afghanistan. In October, 400,000 more documents that came to be known as the Iraq War Logs were leaked. If that were not enough to embarrass the U.S., in November, diplomats around the world began to sweat as WikiLeaks began releasing U.S. diplomatic cables from the State Department. It’s safe to say, the U.S. government has been desperately trying to control the damage, safeguard the further release of its classified information, and go after with a heavy hand anyone who had a role in placing them in such a vulnerable position.

Several weeks ago, I came across a letter that a collaborating group of faculty members and officers from the Columbia University Graduate School of Journalism addressed to President Obama. Their message was straightforward:

we are concerned by recent reports that the Department of Justice is considering criminal charges against Julian Assange or others associated with WikiLeaks…The U.S. and the First Amendment continue to set a world standard for freedom of the press, encouraging journalists in many nations to take significant risks on behalf of transparency. Prosecution in the WikiLeaks case would greatly damage American standing in free-press debates worldwide and would dishearten those journalists looking to this nation for inspiration…We urge you to pursue a course of prudent restraint in the WikiLeaks matter. (Columbia University website)

The letter was careful not to endorse the specific methodology of WikiLeaks, yet came out strongly stating that the actions of publishing these classified U.S. government documents should not in any way fall outside the protection of the 1st Amendment.

This is the same position that is officially cited by the WikiLeak organization. On their website, much of the same language is used. Their mission is spelled out clearly on the homepage of their site.

WikiLeaks is a non-profit media organization dedicated to bringing important news and information to the public. We provide an innovative, secure and anonymous way for independent sources around the world to leak information to our journalists. We publish material of ethical, political and historical significance while keeping the identity of our sources anonymous, thus providing a universal way for the revealing of suppressed and censored injustices. (WikiLeaks website)

They support this goal by calling on the Universal Declaration of Human Rights:

In particular, Article 19 inspires the work of our journalists and other volunteers. It states that everyone has the right to freedom of opinion and expression; this right includes freedom to hold opinions without interference and to seek, receive and impart information and ideas through any media and regardless of frontiers. (WikiLeaks website)

This certainly does not contradict our own constitution. And so, I decided to look closer into the matter. I wanted to understand the real issues here. On one hand, the Obama administration promotes itself as the hero for government transparency advocacy, yet it condemns so adamantly organizations like WikiLeaks. Has WikiLeaks stayed within the bounds of its stated and seemingly noble aspirations? After all, it certainly is not right that our government would go out of its way to cover up things from the American people and the rest of the world.

Take the 2007 attack on civilians in Baghdad, for example. I remember watching that video when it was first released by WikiLeaks in 2010. I was out of the country at the time, but the video had spread virally around the world in a matter of days with the help of Twitter and other social media sharing. It was even more poignant for me at the time, an American living abroad. This was embarrassing. This is what has made the U.S. lose so much credibility in recent years. Was that really how American soldiers act? WikiLeaks steps in and eagerly holds our government accountable. I guess someone has to – if it refuses to do so of its own accord.

My quest to understand the deeper issue led me to Scott Horton, a lecturer at the Columbia Law School, a human rights attorney, and a journalist – also a contributing editor for Harper’s Magazine. I wanted to examine both the history of the issue and the legality of it; and also to see an opinion from a journalistic point of view. Horton was an ideal candidate who met these criteria. He has written much on the subject and was eager to speak with me and share his perspective.

Horton prefaced his forthcoming thoughts by saying that every government does have a legitimate right to claim state secrets. There is a need to have some temporal military and diplomatic secrets in some cases. His concern, a subject he speaks about passionately, is that some governments, namely the U.S., have become increasing obsessed with holding “state secrets.”

The situation has gotten out of control. While there are legitimate times to classify a bit of information as “top secret,” in recent years, the stamp has found its way onto billions of documents – from diplomatic cables to videos like the one from the 2007 civilian attacks in Baghdad that was eventually leaked and decrypted by Wikileak whistleblowers. (Horton) In that case, for example, there was no national security issue, it was simply a matter of not wanting to be held accountable for a gross error on the part of the U.S. military and an unwillingness to face up to it.

This notion that secrecy has gone to the extreme resonates with me. First, why do governments find the need to be increasingly selective in the information they make available to the public, and what, if any, are the consequences of this?

If we look back at government from a philosophical perspective, we can point to ideas like those of John Stuart Mill who asserted that open discourse and debate always has the best outcome. Correct decisions are the end result of this important democratic principle. Horton made two points. First, secrecy tends to undermine the ability to have public discourse; and secondly, secrecy within a government is used as a tool by certain factions to create hierarchy and establish one’s position. This is the idea that “I have more access to info than you...so you can’t criticize me.” (Horton)

Horton has some strong opinions on the matter and drew a stark comparison between recent U.S. government behavior and the political climate in Germany around the end of the First World War. In Economy and Society, economist and sociologist Max Weber examines and criticizes the political situation in those years. He looked into issues such as why Germany had lost the war. His conclusions were clear. One of the key things he points out is that an obsession with secrecy is a major reason why Germany lost the war. This had the unintended result of reshaping the democratic government into something more along the lines of a totalitarian government. (Weber)

Secrecy made the government more mistake-prone. Big mistakes happened, but since no one knew about it, no one could criticize. Secrecy was, in essence, used to protect people who made stupid mistakes. This trend led to more and more stupid people with more and more power rising within governments and became increasingly powerful. At the end of the war, you had a particularly incapable administration leading a country that was very susceptible to errors. (Horton)

Weber did recognize there is a legitimate time and place for some secrets, especially during war, but if the keeping of secrets and the lack of transparency gets carried away with, the end result is, in the words of Horton, a “stupid, mistake prone government.” There is no better way to learn about where we are heading today than by looking at relevant historical precedence. The wise take heed.

Horton made the point that the same is happening today within the U.S. government. More and more secrets are being kept, mainly in order to protect decision makers and cover up mistakes. This has been especially true concerning the decision on whether or not to go to war. He reminded me that, with the war on Iraq, there was an aggressive use of secrets to deceive people and justify the war’s validity. We all remember well the controversy surrounding the beginning of the war in Iraq. Did they have weapons of mass destruction or not? The Bush administration wanted us to think so. Some experts were doubtful. The bottom line was, at the time, the facts were hidden in secrecy – even between those within the government. If someone believed maybe Iraq didn’t have the weapons, we were led to believe that was because they didn’t have access to other “classified” information. Some of us blindly believed. Others were skeptical.

If we give credence to Horton’s striking parallel, the situation is alarming. I see it clearly. It is not difficult to see how this course of unnecessary government secrecy goes against the core foundational theory of democracy and can only lead to a mistake prone path. We have certainly seen evidence of this in recent years.

I can’t help but think of how, even after the war began, it was riddled with cover-ups like the one of the 2007 civilian attacks in Iraq. Even more disturbing to me than the civilian deaths and the playful attitude of those carrying out this killing spree, is the length to which our own government went to cover-up and prevent this from being released to the public. Reuters had even attempted to obtain the video with the freedom of information act, but it was blocked by the Pentagon. (The Guardian, 5 April 2010)

It is not hard to see that such an environment can easily breed stupidity and carelessness. If gross mistakes can be made without the responsible parties being held accountable, then something must be done. Why aren’t more red flags being waved?

WikiLeaks suddenly takes on a whole new justifiable, even admirable role. More than just rebels eager to rile the powers that be, they play the role of blowing their whistles and forcing governments to be transparent, albeit against their will. It should be noted that I am being careful here to separate the group’s leader, Julian Assange, with the organization and its purpose. Also, WikiLeaks has recently stepped into the spotlight because of massive leaks in the past year, but they don’t stand alone. There are numerous other websites doing similar things. (OpenLeaks, for example) These organizations have recognized the imminent consequences of secrecy trends going unchecked. They have made it their goal to be an outlet for whistleblowers to come forward with “classified” government information. They are forcing into the light something that someone has chosen to hide, often for interests not shared by the public in this challenged democracy. In theory, they have every right and obligation to do so. Recall the first amendment, concerned citizens.

Daniel Ellsberg is a former U.S. military analyst who released the famous Pentagon Papers in 1971. In a sense, his was a predecessor to the spirit behind WikiLeaks. He could be considered the first whistleblower as he released top-secret documents about the government’s dealing with Vietnam at the time. In a recent interview with Scott Horton, Ellsberg exhorted a group of law students. “The challenge cannot be greater. So as lawyers, I hope you will stand up for the principles of a country that didn’t make it illegal up to now to tell secrets of state that the public needed to hear.” (Wong)

What does the government have to say? In 1997, Congress commissioned a study, which became known as the Moynihan Commission on Government Secrecy. Some stark similarities can be seen in the conclusions that support Horton’s claims. At the time of this report, there were already well over a billion pages of classified information in the U.S. The report actually also looks to Max Weber, as did Horton:

Every bureaucracy seeks to increase the superiority of the professionally informed by keeping their knowledge and intentions secret... Bureaucracy naturally welcomes a poorly informed and hence a powerless parliament—at least insofar as ignorance somehow agrees with the bureaucracy’s interests. (Weber, Economy and Society) (Moynihan Commission, 1997)

This is certainly everything we hope our government is not. A foundational principle of this country is that we have a well informed and educated public. The conclusions of the Moynihan report:

Excessive secrecy has significant consequences for the national interest when, as a result, policymakers are not fully informed, government is not held accountable for its actions, and the public cannot engage in informed debate. (Moynihan Commission, 1997)

The report further concludes that secrecy does have a legitimate place, but that it must return to a restrained and limited role.

How has the government fared since this advice was released in 1997? The result was eight years of the Bush administration steeped in secrecy, cover-ups, and classified documents to hide behind. Beyond the examples given regarding the war with Iraq, the civilian deaths and abuse cover-ups, we could also talk about September 11, 2001 or Guantanamo Bay or other things that the Bush administration kept so hidden from the public.

What about the Obama administration? This became a point of contention he had with the Bush administration during his campaign. He vowed to make the government more transparent.

On the last day of March this year, in a quiet meeting behind closed doors, President Obama accepted an award for transparency in his government. (Phillip) This should come as no surprise for a president who had spoken out so strongly for more transparency and less secrecy in government. "My Administration is committed to creating an unprecedented level of openness in Government” - Barack Obama, January 28, 2009. Promising “a new era of openness in our country,” President Obama [said]: “Transparency and the rule of law will be the touchstones of this presidency” (CNN, 21 Jan 2009).

Hardly. First of all, why is an award for transparency shrouded in secrecy? No press was invited. One of the people who was invited was Gary Bass, of OMB Watch, a non-profit organization based in Washington dedicated to seeing a more transparent White House. Afterwards, he expressed concern over why the meeting was made so private. The White House press secretary, Jay Carney responded by saying, “This president has demonstrated a commitment to transparency and openness that is greater than any administration has shown in the past, and he’s been committed to that since he ran for President.” (Phillip)

Obviously there is something to hide – his actual record? Since assuming office, we see a story he would probably rather conceal. To illustrate this, consider his record on whistleblowers, or those who choose to reveal secrets of the state. (Think: help promote transparency, like WikiLeaks) In his campaign, Obama explicitly vowed to create a more transparent government, but instead those who attempt to bring to light government classified information – are being prosecuted under the Espionage Act of 1917. These kinds of cases are, in the words of human rights attorney Scott Horton, “malicious, nasty, and unfair.” The reality is that Obama has prosecuted more whistleblowers under the Espionage Act than all other presidents throughout history – combined. (Horton) One of these, Private Manning, is accused of being the source for much of the classified information Wikileak has made public in the last couple of years.

I asked Scott Horton about media coverage of WikiLeaks. In addition to being an attorney, he is a journalist and writes for Harper’s. Referring particularly to the New York Times, he said that “the news editors are really focused on keeping the government happy...and not crossing the line to have the federal government go after them.” He went on to say that they are, in his opinion, easily intimidated. They have joined the Obama administration’s agenda of concentrating the spotlight on Assange and Manning instead of on the real issues. Horton has recently studied the global media coverage of WikiLeaks. “The most irresponsible coverage of WikiLeaks anywhere in the world is in the United States.” Often the articles, instead of addressing the cover-ups and potential corruption, take the side of the U.S. government in pointing the finger at various incidences that are portrayed as examples of how the leaks have wreaked havoc on the government.

Why hasn’t the media taken a more objective look at these issues? Even major news outlets like the New York Times with huge stories like WikiLeaks in the past year have, for the most part, decided to err on the safe side with the government. It is interesting to note that the government, in the past year, has never attempted to discredit the documents’ legitimacy. Again, the damage control policy of the government (with the support of the U.S. media), has largely attempted to draw attention away from WikiLeaks as an organization and away from the content of the leaked documents and wires. The focus, instead, has been to incriminate its leader, Julian Assange, in the court of public opinion. This is ridiculous, because, in the end, this has absolutely nothing to do with Assange. This is about mistakes, cover-ups, and allowing the world to see a transparent perspective of U.S. government proceedings.

Another example of U.S. media swaying the public’s focus away from the pertinent issues can be seen in an article published by the New York Times last August about Pfc. Bradley Manning, who is largely credited for leaking the government documents to WikiLeaks. A large part of the article centered around Mannings’ troubled childhood and insecurities about his own sexuality. As interesting as it may appear to some, the fact that his boyfriend was a “self-described drag queen,” is completely irrelevant, and serves only to shift the American public’s attention away from the content of the leaked documents. (Thompson, The New York Times)

Is there really any instance where we can point to WikiLeaks and say that because of the documents released, an undesirable outcome ensued? There have been no cases of national security being put at risk because of the leaks. Sure, there are plenty of embarrassing situations for the U.S., but good seems to be the result in almost every situation. Even if we take the recent incidence of Carlos Pascual, ambassador to Mexico, it would be hard to say that WikiLeaks did real damage. Among the leaked cables were ones in which the ambassador harshly criticized Mexican President Calderon’s handling of the war on drugs. Calderon was irate and demanded that Pascual be removed as ambassador to Mexico. Several days later, he did resign, but even Mexican media, which is usually eager to criticize the U.S., admits that this has more to do with personal differences between President Calderon and Pascual. It’s no coincidence that Pascual’s new girlfriend is the daughter of the PRI’s leader, the political party which happens to be the strongest opponent to Calderon’s government. Most U.S. media, again, have portrayed this as another reason to justify the government’s aggressive campaign to dismantle WikiLeaks and build its case against Assange and Manning.

In a recent discussion panel at Harvard Law School, Scott Horton asserted that many of the recent incidences and resulting rebellions in the Middle East and North Africa can be credited to WikiLeaks. He went so far to say that it is clear that what has transpired in Tunisia and Egypt is a direct result of the WikiLeak cables being made public. (Wong) In Egypt, the ambassador, Robert Godec, had sent detailed reports of the corruption, abuse of power, and lavish wealth that the president and his government enjoyed. When, through the published Wikileak cables, the Egyptian people read these accounts, they decided things had gone too far and began to demand that the president step down. The situation in Tunisia was similar. (Coll, The New Yorker)

The evidence is overwhelming. The widespread lack of transparency and the current trend in the U.S. government to classify non-essential information and cover-up stories is alarming if not downright disconcerting. The real issue here isn’t WikiLeaks, it isn’t what an ambassador sent in a cable to Washington, it isn’t even (although it certainly could be) how we were deceived into believing the government had a legitimate reason for going to war. The issue that the Columbia Journalism School acted upon when writing to President Obama was justified and necessary in this process, but even defending a journalist’s right to go to press with classified information isn’t the main thing that concerns me. The issue here is much deeper. When I examine the root of the issue, I can only see the government’s apparent need for and preoccupation with secrecy. It is the fact that an environment is being created in our government, or alas, is already deeply embedded, that perpetuates a leadership consisting of foolish people making foolish decisions. If bad decisions, like those to cover up the stories of civilian deaths in Iraq, can be made and then easily covered up, bad decisions will be made even easier. How much more has happened that we may never know about? A climate of escalating secrecy ensues – it must, in order to maintain and protect itself. If we take a step back to gain an objective perspective, this is the heart of the issue.

Nothing is pretty about war. Mistakes have always happened and probably always will. A mistake like that of U.S. soldiers firing on and killing what ended up being civilians was tragic, but if the government had taken disciplinary measurements, where needed, and owned up to the fatal error that was made, there might be less reason to worry. It is the tendency towards hiding these kinds of mistakes that is so troubling. There is nothing noble about that.

Where will this lead us? This is the only question that remains in my mind. I can find no other position than to hope for more loyal citizens to step forward and blow their whistles at hidden injustices and corruption, and be willing to shed light to the public, through organizations like WikiLeaks. Truth is not always easy, and transparency can be discomforting, but in the end –they always prove superior.

Works Cited

Coll, Steve. “Democratic Movements.” The New Yorker. 31 January 2011. http://www.newyorker.com/talk/comment/2011/01/31/110131taco_talk_coll

Columbia Journalism School. 4 January 2011 http://www.journalism.columbia.edu/news/295

CNN. “Vowing Transparency, Obama Oks ethics Guidelines”. 21 Jan 2009 http://articles.cnn.com/2009-01-21/politics/obama.business_1_first-lady-...

Horton, Scott. “WikiLeaks: The National-Security State Strikes Back” Harper’s Magazine. 3 August 2010. http://harpers.org/archive/2010/08/hbc-90007466>

Horton, Scott. “The Pentagon Loses a Skirmish with WikiLeaks” Harper’s Magazine. 19 March 2010. http://harpers.org/archive/2010/03/hbc-90006732

Horton, Scott. “The Washington Post and WikiLeaks” Harper’s Magazine. 29 October 2010. http://harpers.org/archive/2010/10/hbc-90007774

McGreal, Chris. “WikiLeaks reveals video showing US air crew shooting down Iraqi civilians.” Guardian. 5 April 2010 http://www.guardian.co.uk/world/2010/apr/05/wikileaks-us-army-iraq-attack

Moynihan Commission on Government Secrecy, SENATE DOCUMENT 105-2 PURSUANT TO PUBLIC LAW 236, 103RD CONGRESS UNITED STATES GOVERNMENT PRINTING OFFICE, WASHINGTON : 1997 http://www.fas.org/sgp/library/moynihan/foreword.html

Phillip, Abby. “Shh! Obama gets Anti-Secrecy Award” Politico44. 30 March 2011 http://www.politico.com/politico44/perm/0311/not_a_secret_anymore_a00ccd...

Thomas, Ginger. Early Struggles of Soldier Charged in Leak Case”. The New York Times. 8 Aug 2010. http://www.nytimes.com/2010/08/09/us/09manning.html

Wong, Joanne. Harvard Law School. 30 March 2011 http://www.law.harvard.edu/news/2011/03/pentagon-papers_wikileaks.html

Weber, Max. Economy and Society. 1922.

WikiLeaks http://mirror.wikileaks.info/

Competition Entry | Speak Boldly

How can individuals and societies protect themselves against the encroachment and abuse of government power in the modern age?

By Rhonda Dolen

If one stands and watches a mass of people in a dark night, take one candle, and with it, light all the other candles held by hopeful hands under dark skies, until the night flickers with a brilliant beauty from star-like, flickering candles, lighting the darkened landscape; then one is witnessing a representation of the power of words, words that are filled with appeals to humanity, to justice, to reason, to freedom, to an end to corruption. Appeals to justice and humanity catch fire in people’s souls until soldiers accept flowers in the barrels of their guns and stand down as iron curtains are ripped to pieces.

The best way to fight off the encroachment and abuse of government power in the modern age is by appealing to the quality of being humane – by appealing to humanity. These appeals to humanity should encourage people to recognize the vital importance of supporting WikiLeaks and organizations like it - and of supporting whistleblowers in general.

Appeals to humanity have achieved exquisite victories in modern history with no weapons but voices. Gandhi in India, Martin Luther King, Jr. in America’s southern states, the recent Tunisian and Egyptian revolutions, the dismantling of the Berlin Wall, all testify to the power of our better natures when we stand up and say, “Enough!” And indeed, the use of weapons by individuals against modern governments would be a hopeless, and at the very least, bloody endeavor in most cases.

The weaponry power of states has never been so great. Individuals and societies, in order to be truly free, must enlist genuine nonviolent support from people who are motivated by humanity to fight off the ever-growing hand of governments’ powers and their iron fist'ed abuses the world over - whether it be corruption in public policyor questionable war-related decisions in democracies or even the naked subjugation of citizens in dictatorial states.

The best way to do this is for people to speak boldly out in support of whistleblowers and in support of WikiLeaks and organizations like it. It is especially vital that people in democracies, who face less risk by speaking out, be encouraged to do so.

Those who believe they live in democracies should take the opportunity to support themselves while they can, and to support those who live in states where the iron boots can often seem too heavy to crawl out from under, by speaking out while they can. After all, people all over the Middle East, where speech is severely curtailed, are throwing off chains. People in ‘freer’ countries must continue to support organizations that threaten corrupt governments. People in freer countries must turn their eyes even inward to the corruption in their own governments as well.

Corruption will grow like a cancer if not checked. When one sees injustice, one who still has vestiges of freedom in one’s country should not stay silent; one should share it with everyone one knows; one should write letters; one should financially support those seeking to right these injustices; one should ask that the injustice stop. An injustice recognized, cannot long stand the sweeping flame of human recognition. As people recognize injustice, one by one, the majority will light up inside like candles against a night of oppression.

WikiLeaks is a vehicle that can help to make corruption, oppression, torture, twisted public policy deals and government abuse risky. Large corporations, too, some of them with yearly revenue rivaling nation states, are encouraged to be honest and fair by the mere existence of WikiLeaks.

WikiLeaks and organizations like it can provide a check on increasing government power. Corporate power too, needs a check. If people were made to understand that WikiLeaks presents the possibility of making corruption an exceedingly increasingly risky activity for all world governments and corporations, the tide of support for WikiLeaks could not be stopped.

So, people are told not to read the leaks that WikiLeaks publishes; they hint that it is treason; they are told WikiLeaks is politically motivated; they are told it is not newsworthy. They are told that we are learning nothing important. If it is not newsworthy, why is the organization being financially strangled by a financial boycott by VISA, Mastercard and Paypal, likely inspired by pressure from government? Why is its founder being held for over six months under house arrest without having been charged for a crime in any country? Why is it hinted to Americans that to even read leaked State Department cables might be a crime?

It is not just America’s government that has faced leaks, but one would hardly know that from U.S. press coverage. Conscientious American whistleblowers have supplied information to WikiLeaks about corruption in human rights and in diplomacy, yes. Prior to that, a Kenyan election appears to have been swayed by revelations from WikiLeaks. Most recently, revolutions in the Middle East apparently owe some of their fervent emotional fire to information published by WikiLeaks. Change has occurred all over the world due to revelations in leaks provided to WikiLeaks by whistleblowers, even now, while WikiLeaks is being strangled by the iron hands of multiple governments. WikiLeaks is the People’s Intelligence Agency, as it calls itself.

Shouldn’t you want to know about corrupt activities your government may be up to?

Whistleblowers are like candle-lighters. Let people be courageous enough to take up candles themselves from a whistleblower’s flame and light the candles of others. As the candles burn with an increasingly brilliant light, turning night to day, like the sun, the Sunshine Press, as WikiLeaks also calls itself, can provide its disinfectant and inspire others to join the fight. “Sunshine is the best disinfectant” U.S. Supreme Court Justice Louis Brandeis stated. As Julian Assange states, “Courage is contagious.” Courage can catch on, just like one candle can light a multitude of other candles and an idea can spread like a wildfire.

Of course governments need to keep secrets, but it is their responsibility to do so, not ours, and if those secrets are about a government’s corrupt practices, why should it be called treason if the people are leaked legitimately important information about corruption? It is not the people who fear WikiLeaks. WikiLeaks is being maligned to the people by their corrupt leaders. It is the corrupt leaders who fear WikiLeaks.

As Assange has suggested, if governments and corporations know corrupt practices may easily be exposed, individuals in government and corporate life will begin to see corruption as increasingly risky. WikiLeaks provides true anonymity to its sources. One could drop off one’s info in their secure “electronic box” and WikiLeaks itself would have no idea who its sources were. Thus, its staff and managers could not be compelled to testify as to who their sources were.

It would be impossible because they could not identify the source. The reason WikiLeaks cannot tell a government who its sources are is due to the technological set up of its site that shields them from the identity of the source.

Despite this anonymity, WikiLeaks is able to work to verify all the information it receives quite thoroughly. Its accuracy does not seem to be in question. They have sent staff to Iraq, for instance, to investigate the footage they received that became the Collateral Murder video.

With the power of anonymity, sources can feel secure, and information about corruption will flow in. Suddenly corrupt people can never be sure that their corrupt practices won’t be leaked by emboldened, anonymous whistleblowers, ending up as front page news. If this novel idea is allowed to continue unimpeded, there are few politicians who will not fear it, because few politicians are not corrupt. They might be forced to significantly reduce the extent of their corruption.

And so the smear campaign has been set loose. WikiLeaks is accused of endangering people but even the Pentagon admits it cannot find a single person physically harmed by the release of its leaks. Assange is dragged through the mud with ad hominem attacks and vitriol that tries to pass for journalism by journalists eager not to arouse the wrath of governments that kill in dictatorial countries and democracies that will, incredibly, threaten or hint to journalists that they may be charged with treason.

Despite this backlash by the corrupt, the majority of people must be inspired to support organizations like WikiLeaks and support whistleblowers and reformers. How can reformers operate and clean out corrupt politicians if whistleblowers face solitary confinement, life in prison, torture or execution even in democracies that claim to be beacons of light? How can reformers and whistleblowers work their magic if the organization they could once so easily turn to is being ravaged with barely a peep from the hoodwinked people?

Democratic governments are using the threat of terrorism to garner increasing powers of surveillance over its peoples. WikiLeaks adamantly supports people’s freedom from intrusive government surveillance that violates civil liberties while calling for increasing scrutiny of leaders, who are entrusted with great power and whose back room deals should therefore be subject to exposure, when those deals are based on corruption. WikiLeaks allows us to take technology and use it for the people, to help turn the tide of increasing government intrusion, power and corruption by giving whistleblowers anonymity.

Bradley Manning, alleged U.S. State Department cables and Collateral Murder video whistleblower, may have slipped up and revealed himself. WikiLeaks did not identify him and cannot know if he is its source for that information. People must come to realize that WikiLeaks and similar organizations and whistleblowers should be protected from the politicians who want to crush them. People who recognize what is happening must have courage and try to set the flame of courage in others’ hearts because “Courage is contagious.” If we can get candles of the human soul lighting all around us, eventually, this may spread over the globe and we can have a new, effective check against corruption.

The alternative is an increasing darkness, difficulties reforming, increasing secrecy and control, more ridiculous laws and decisions and policies, stacks of corrupt laws in the law books of the world going unchallenged, and flickering candles of courage extinguishing all over the earth.

If governments and corporations know corrupt practices may easily be exposed, individuals in government and corporate life will begin to see corruption as increasingly risky. No power is as great as the human spirit. It has destroyed the power of dictators and corruption without using violence and it will destroy the firewall of lies that threatens to close people off from the contagious truth that can lift away curtains of corruption.

Speak out boldly for reform, for whistleblowers, for the truth and for courage. Encourage people to question their politicians’ versions of the truth; encourage questions; encourage boldness. Speak boldly now. This appeal to humanity is the best way for individuals and societies to protect themselves against the encroachment and abuse of government power in the modern age. Legend tells us that before Prometheus stole fire from heaven, humans had wanted light. And sharing light is as easy as passing a candle.

Announcing the WL Central 3rd Monthly Competition Winner | Imperium ex Nihilo

The third monthly WikiLeaks Central Competition 2011 asked writers to answer to the question: What are the root causes of the global economic crisis?

The winner is:

Imperium ex Nihilo
Authored by JP Orient

This essay was, hands down, one of the finest essays submitted to all three competitions. We encourage everyone to read it.

All the submissions were judged on (i) newsworthiness; (ii) supporting research; and (iii) organization and writing style. (iv) We also considered the submission's capacity to engender online discourse in the form of comments and retweets.

Competition Entry | Financial Collapse because of Fiat Currency, Central Banks and The Federal Reserve

What are the root causes of the global economic crisis?

by AIS

"It is well that the people of the nation do not understand our banking and monetary system, for if they did, I believe there would be a revolution before tomorrow morning." ― Henry Ford

Historically, many things have been used for money with the most enduring form being Gold or Silver. Paper money is largely a new idea, and the tool of scoundrels and the devious to debase the value of people's savings.

The unconstitutional Federal Reserve was established in December 1913. The plans for The Fed were created in secret at Jekyll Island, Georgia in 1910.

The US dollar as the World's Reserve Currency was established as such by the Bretton Woods Agreement in 1944: “The chief features of the Bretton Woods system were an obligation for each country to adopt a monetary policy that maintained the exchange rate by tying its currency to the U.S. dollar and the ability of the IMF to bridge temporary imbalances of payments”.

“On August 15, 1971, the United States unilaterally terminated convertibility of the dollar to Gold. As a result, "[t]he Bretton Woods system officially ended and the dollar became fully 'fiat currency,' backed by nothing but the promise of the federal government."

Fiat currency is simply this: The government says that something is money and must therefore be used as money. In the case of the US it is paper money and base metal coins.

The Fed essentially creates money “out of thin air”. You can find out how this is done here.

To understand the current US banking system you have to understand one completely absurd truth (at least for them), namely “debt is money”. The more debt there is, the more money a bank can “create”. The entire banking system is a complete fraud.

The central banks in other countries do primarily the same thing that the Fed does - money is created mostly by the push of a computer button and sent to banks as “loans”. There is no substance to back the money, there is no Gold backing the money - just the “full faith and credit of United States Government” which at this point looks like no faith and lousy credit.

There is no intrinsic value to any fiat currency - there is only perceived value. It is not like Gold or Silver which historically have been used for money and both are metals that people want and recognize as something which can store value. Prosperity can never come from a printing press.

An increase of the money supply by the Fed “pumping” money into the system has caused the majority of America's financial woes. For example, Greenspan pumped billions of dollars (all electronically created) into the US economy after the disaster of 9/11 which helped create a “housing bubble” of over inflated house prices that burst in late 2007 and led to the collapse of the US housing markets and was soon followed by the stock market.

David Gregory, moderator of “Meet The Press” on NBC asked Greenspan: “Are U.S. treasury bonds still safe to invest in?” Alan Greenspan, former Chairman of the Federal Reserve responded, “Very much so. This is not an issue of credit rating, the United States can pay any debt it has because we can always print money to do that. So, there is zero probability of default.”

Greenspan's comment above may sound crazy. He's right. The Fed can just keep on its rampage of inflating the money supply and pay off any debt. The problem is that when the money supply is inflated, the price of goods follows right behind it. And there comes a point in time when people demand too many dollars and thus hyper-inflation happens.

Since The Fed's inception and its control of the money supply the dollar's value has eroded by 96% of it's purchasing power from 1914. What was purchased for 4 cents in 1914 now requires $1.

As the world governments and central banks, particularly The Fed, have no substance to back the money with, that is Gold or Silver, there is no limit to how much money can be “created”. It is a vicious cycle - the more money “created out of thin air” the higher the prices of goods and the less confidence people have in the money as being a way to retain their purchasing power or savings.

The current price of Gold or Silver is a strong indication that many have no confidence in paper money and they're buying Gold and Silver it as protection against the devaluation of their wealth of fiat currency. Gold this year alone has increased in value by around 30%.

As the US had flooded the world with its debt (by borrowing money from places like China, for instance) in order to fund its wars, many countries are realizing that the US dollar is worth less and less as time goes by. They realize it would be better to not use the dollar as much, or to trade in currencies other than the US dollar.

And, it appears that the US is losing its “reserve currency” status. Several countries have directly tried to get away from the dollar and trade goods based on other currencies or commodities. Iraq, under Saddam Hussein, tried and I would suggest where that got him and Iraq. Iran is doing the same thing. They are trading their oil on the open market and receive payment in the form they want, which is not based on the value of the dollar.

The collapse is simple. The US flooded the world with its ever increasing supply of dollars which has led to a declining value of the dollar and its resulting impact upon markets. Countries want to get away from the US dollar as the reserve currency to something more stable.

The world is in a transition phase to some other standard of money. There have been talks about the use of Gold as money or the return of the US to the Gold standard but in the short term it appears highly unlikely that the “banksters” will allow anything that will interfere with their ability to create money “out of thin air”.

The control or manipulation of the money supply is too important to be left in the hands of any government or central bank. It should be left to people alone to decide what form of money they want. For example, if you want to be paid with pencils or copper pipe it's entirely your prerogative to receive such for payment.

There is no “free market” in the US. It is a completely controlled, centrally planned economy. You're not free to create a business without having to comply with countless “regulations” which are merely designed to crush creativity, prevent competition, and confiscate the wealth of those that would be so adventurous as to try and make money.

Ron Paul is the only politician in America who stands firmly against the Fed, fiat currency, and Federal spending. I believe that he has a very clear understanding of economics and why there's a business cycle of “boom and bust” and how to stop it - End the Fed, end the wars, and eliminate the US governments ability to control the money supply.

Here are what I believe are some great quotes about banking:

"I believe that banking institutions are more dangerous to our liberties than standing armies..." - Thomas Jefferson

Concerning the central bank in his time, “You are a den of vipers and thieves. I intend to rout you out, and by the grace of the Eternal God, will rout you out”. - Andrew Jackson

“I am one of those who do not believe that a national debt is a national blessing, but rather a curse to a republic; inasmuch as it is calculated to raise around the administration a moneyed aristocracy danger us to the liberties of the country”. - Andrew Jackson

"The few who understand the system, will either be so interested from its profits or so dependent on its favors, that there will be no opposition from that class." - Rothschild Brothers of London, 1863

"Give me control of a nation's money and I care not who makes it's laws" - Mayer Amschel Bauer Rothschild

"Most Americans have no real understanding of the operation of the international money lenders. The accounts of the Federal Reserve System have never been audited. It operates outside the control of Congress and manipulates the credit of the United States" - Sen. Barry Goldwater (Rep. AR)

"This [Federal Reserve Act] establishes the most gigantic trust on earth. When the President [Wilson] signs this bill, the invisible government of the monetary power will be legalized....the worst legislative crime of the ages is perpetrated by this banking and currency bill." - Charles A. Lindbergh, Sr., 1913

"From now on, depressions will be scientifically created." - Charles A. Lindbergh Sr., 1913

"The financial system has been turned over to the Federal Reserve Board. That Board as ministers the finance system by authority of a purely profiteering group. The system is private, conducted for the sole purpose of obtaining the greatest possible profits from the use of other people's money" - Charles A. Lindbergh Sr., 1923

"The Federal Reserve bank buys government bonds without one penny..." - Congressman Wright Patman, Congressional Record, Sept 30, 1941

"We have, in this country, one of the most corrupt institutions the world has ever known. I refer to the Federal Reserve Board. This evil institution has impoverished the people of the United States and has practically bankrupted our government. It has done this through the corrupt practices of the moneyed vultures who control it". - Congressman Louis T. McFadden in 1932 (Rep. PA)

"The Federal Reserve banks are one of the most corrupt institutions the world has ever seen. There is not a man within the sound of my voice who does not know that this nation is run by the International bankers - Congressman Louis T. McFadden (Rep. PA)

"Some people think the Federal Reserve Banks are the United States government's institutions. They are not government institutions. They are private credit monopolies which prey upon the people of the United States for the benefit of themselves and their foreign swindlers" - Congressional Record 12595-12603, Louis T. McFadden, Chairman of the Committee on Banking and Currency (12 years) June 10, 1932

"I have never seen more Senators express discontent with their jobs....I think the major cause is that, deep down in our hearts, we have been accomplices in doing something terrible and unforgivable to our wonderful country. Deep down in our heart, we know that we have given our children a legacy of bankruptcy. We have defrauded our country to get ourselves elected." - John Danforth (R-Mo)

"These 12 corporations together cover the whole country and monopolize and use for private gain every dollar of the public currency..." - Mr. Crozier of Cincinnati, before Senate Banking and Currency Committee – 1913

"The [Federal Reserve Act] as it stands seems to me to open the way to a vast inflation of the currency... I do not like to think that any law can be passed that will make it possible to submerge the gold standard in a flood of irredeemable paper currency." - Henry Cabot Lodge Sr., 1913

By the Federal Reserves Own Admissions:

"When you or I write a check there must be sufficient funds in out account to cover the check, but when the Federal Reserve writes a check there is no bank deposit on which that check is drawn. When the Federal Reserve writes a check, it is creating money." - Putting It Simply, Boston Federal Reserve Bank

“Neither paper currency nor deposits have value as commodities, intrinsically, a 'dollar' bill is just a piece of paper. Deposits are merely book entries." - Modern Money Mechanics Workbook, Federal Reserve Bank of Chicago, 1975

"The Federal Reserve system pays the U.S. Treasury $20.60 per thousand notes - a little over 2 cents each- without regard to the face value of the note. Federal Reserve Notes, incidentally, are the only type of currency now produced for circulation. They are printed exclusively by the Treasury's Bureau of Engraving and Printing, and the $20.60 per thousand price reflects the Bureau's full cost of production. Federal Reserve Notes are printed in 01, 02, 05, 10, 20, 50, and 100 dollar denominations only; notes of 500, 1000, 5000, and 10,000 denominations were last printed in 1945." - Donald J. Winn, Assistant to the Board of Governors of the Federal Reserve system

"We are completely dependent on the commercial banks. Someone has to borrow every dollar we have in circulation, cash or credit. If the banks create ample synthetic money we are prosperous; if not, we starve. We are absolutely without a permanent money system...It is the most important subject intelligent persons can investigate and reflect upon. It is so important that our present civilization may collapse unless it becomes widely understood and the defects remedied very soon." - Robert H. Hamphill, Atlanta Federal Reserve Bank

"By this means government may secretly and unobserved, confiscate the wealth of the people, and not one man in a million will detect the theft." - John Maynard Keynes (the father of 'Keynesian Economics' which our nation now endures) in his book The Economic Consequences of Peace (1920). [NB Keynes was a scoundrel. He means in the affirmative of what he'd like to do with those that try and save money - take it from them.

"Should government refrain from regulation (taxation), the worthlessness of the money becomes apparent and the fraud can no longer be concealed." - John Maynard Keynes, Consequences of Peace

"Banks lend by creating credit. They create the means of payment out of nothing" - Ralph M. Hawtrey, Secretary of the British Treasury

“A system of capitalism presumes sound money, not fiat money manipulated by a central bank. Capitalism cherishes voluntary contracts and interest rates that are determined by savings, not credit creation by a central bank." - Ron Paul

“Believe me, the next step is a currency crisis because there will be a rejection of the dollar, the rejection of the dollar is a big, big event, and then your personal liberties are going to be severely threatened”. - Ron Paul

“Deficits mean future tax increases, pure and simple. Deficit spending should be viewed as a tax on future generations, and politicians who create deficits should be exposed as tax hikers." - Ron Paul

“I will always vote what I have promised, and always vote the Constitution, as well as I will not vote for one single penny that isn't paid for, because debt is the monster, debt is what's going to eat us up and that is why our economy is on the brink." - Ron Paul

Conclusions

The world's economic woes have been created and are not accidental. They are a consequence of the central banks ability to create money out of thin air. Central economic planning and controls by the governments of the world have only made things worse.

There are several books and web sites which I believe will provide much more information about this entire debacle:

• End The Fed, by Ron Paul
• What Has Government Done to Our Money? by Murray N. Rothbard
• Ludwig von Mises on Money and Inflation, Mises.org
• lewrockwell.com
• The Creature from Jekyll Island, G. Edward Griffin

Competition Entry | The Institutional Power Alliance Behind the Global Economic Crisis

What are the root causes of the global economic crisis?

by chilywilly

In the past decade, the world has seen the kind of power that unaccountable institutions wield. The effects of globalization since the mid 20th century have revealed highly centralized structures of power, from financial conglomerates to pharmaceutical monopolies and oligarchic neo-corporate states.

These dominant institutions not only have extensive control over resources and capital, but make social, economic, and political decisions outside the public’s sphere of influence. Their links to one another became ubiquitously apparent during the global economic crisis of 2008, and their alliances continue to pose the greatest threat to economic stability internationally moving forward.

Extensive analyses of global institutions have been done in the past by intellectuals and by courageous journalists. Much work has been done on explaining the roles that both businesses and states have to play in what's called a market society, and their respective (and general) interests have been closely examined. The work of populous intellectuals and muckraking techniques used by whistleblowers like WikiLeaks has inspired activists in communities all around the world to socially pressure powerful institutions for various humane purposes.

But pushing society’s institutions to their limits is, by definition, not enough to significantly alter the concentrations of power inherent in the modern economy. Rather, the limits must be removed and replaced with whatever level of democracy upon which independent communities may choose. How society progresses toward that point remains in question, let alone at what rate. But understanding how far-removed and undemocratic the linkage between the corporate sectors and governments reveals an honest glimpse into the underlying causes of the economic predicament with which the world continues to struggle.

Correctly indentifying the powers inherent in the marketplace, both positive and negative, is the basis for gaining a perception of the world’s democracy deficit. The most recent major deregulation of financial markets, first suggested by former Clinton adviser Dick Morris in his arguments for ‘triangulation’ (a political strategy designed to please everyone in power, rather than just select wealthy groups), that began in 1997 is nothing more than a marginal byproduct of the rise of ‘too big to fail’ institutions.

These massive, complex institutions rose to their exceedingly obese statures in accordance with undemocratic laws dating back to the Nixon era. In the 1970s, New Deal era constraints (the Bretton Woods system) created by the US government to control capital flows were repealed, leading to the first finance-related giveaway of public-power to private financial organizations. Prior to this, massive transfers of public funds or materials (research) to private firms was done more obscurely; through tax giveaways, ‘military’ expenditures, and communities diminishing their standards by providing what businesses and the World Bank call a “better climate for investment.”

By now, private financial firms and investors had the power to regulate public finance to the extent that the free market would allow them to do so.The world would soon learn that in reality, only states could prevent the monopolization and takeover of the financial markets. Thus, one logically assumes that the state may serve as a counter-balance to the corporate systems of power. Alan Greenspan’s unremitting beliefs in the “self correcting power of free markets” combined with presidential capitulation to the corporate campaign financiers led to numerous pieces of deregulatory legislation in the late 20th century that decimated this assumption.

Reality occurred to government at the peak of 2008’s financial crisis, and the US government anxiously began pouring liquidity into the ‘private’ economy and rescuing gargantuan financial institutions from illegitimate activity. All of this was bitterly opposed by the so-called left-wing groups and right-wing tea party groups, which were unified in their public voice against the bailouts. Despite the media narrative explaining a culture of divisiveness that has just recently infiltrated America, the population was united in its opposition to an unprecedented economic role for taxpayers to play.

But the US government closely followed a record of power dynamics, the uncontroversial root of socioeconomic instability, namely that governments do not listen to their populations. This makes all the above history nothing more than a footnote, because if the public voice had been strong enough to force its position upon its rulers, there would not have been any bailout of the financial institutions. The democracy deficit, or the political distance between institutions and the people, remains the culprit for the reaction to the financial collapse.

The global economic crisis, in turn, became the end result of the public voice’s inability to scream its position loud enough to pierce the ears and hearts of those who make our decisions for us: those in power.

William Shaub (U/N: chilywilly)

Competition Entry | The Root Causes of the Global Economic Crisis

What are the root causes of the global economic crisis?

by Radioactive

These days, the most talked about news is the financial crisis that has engulfed the world economy. Everybody, the main headline of all newspapers is about falling share markets, decreasing industrial growth, high unemployment rates and the overall negative mood of the world economy (Eklavya, 2008).

The global economy crisis which is being experienced today cannot be seen as an event but rather, a process which has been building over time but has become more noticeable since September 2008 when a series of unprecedented events began to reorient the Global financial system.

These series of events has resulted in a global phenomenon called global economic/financial crisis. So what has caused this major economic upheaval in the world? What is the cause of falling share markets in the world and bankruptcy of major banks? In this essay, I intend to explain the root causes of the present day global economic crisis.

Recently, my local bank went bankrupt due to the global financial crisis. I had thought that the crisis would not reach Nigeria since we are relatively under-developed, I never knew that it was truly “global” and that even the rodents who spend some time in my room are suffering same predicament.

According to Professor Joseph Stiglitz, a Noble laureate and Professor at Columbia University, “the current financial crisis, which began in the US and then spread to Europe, has now become global” (Global Research, 2009). If you ask a thousand economists what they think is the root cause/causes of the global economic crisis, you will probably get a thousand answers! That aside, the current financial crisis is believed to have started in the United States of America where there is an imbalance in the circular flow of income.

Households and firms are the two agents in an economy. They make up the national income and national product and an economy can be in balance only if national income equals national product. However, technology improvements in two key areas, telecommunications and transportation, allowed firms in the US to outsource many design and manufacturing jobs to distant locations thus, creating an out of balance in the input and output flows.

Most of the outsourcing of labor has been to developing countries such as China and India, where labor costs are a fraction of the U.S. labor costs. As a result, China and other countries are supplying a portion of the production factors to U.S. firms that was formerly supplied by U.S. households. Money is flowing the opposite way from U.S. firms to China through the factor market.

The great imbalance arises because Chinese households are not closing the loop and buying goods and service from U.S. firms. Instead, they are hoarding most of the money, as much as 50%, and lending it to the U.S. households (Eklavya, 2008).

The U.S. households are then using the loans from Chinese savers to buy goods and services from the U.S. firms. From 2000 to 2008, U.S. households increased consumer spending, without seeing an increase in their household income. The difference has been made up with borrowed funds. In the process, the U.S. households have been building up debt which is owned to the Chinese.

This debt is in the form of credit card debt, auto loans, and the big one, home loans, which were collateralized by the U.S. housing stock. The fundamental problem is that the circular flow of income and output are out of balance. Why? Because Chinese households are selling their labor in the Factor Market, but are not buying goods in the Product Market.

For an economy to work, everyone must be both a producer and consumer. Henry Ford understood this well. His principle was that every Ford employee should afford to own a Ford automobile. If you were in Detroit during the heyday of the motor city, every car in the employee packing lot was a late mode Ford. If you go today to a Ford plant in Shanghai or Nanjing, would you see the same thing? (Eklavya, 2008).

Profligate lending, a macro-economic factor, occurred throughout all markets in the United States. The greater availability of mortgage funding predictably led to greater demand for housing, as people who couldn’t have previously qualified for credit (“sub-prime” borrowers) received loans far larger than they could have secured in the past (“prime” borrowers). When over-stretched, subprime and prime borrowers were unable to make their mortgage payments, the delinquency and foreclosure rates couldn’t be absorbed by the lenders (and those which held or bought the “toxic” paper). This undermined the mortgage market, leading to the failures of firms like Bear Stears and Lehman Brothers and the virtual failures of Fannie Mae and Freddie Mac (Wendell, 2008).

An example of how difficult the situation became in the second quarter of 2007, was when Citigroup, one the largest U.S. bank, lost U.S.$ 9,800 million committed securities because of the mortgages, whose interests were extremely.

Another possible cause of the global economic crisis lies in the compensation structure of the top executives of financial institutions. It was one based on hefty incentives and bonuses. To achieve this, they created innovative financial products that did not meet the risk-return criteria in the long run. These products were great in isolation and got great returns to the investors in the short run. However, they did not stand the test of time.

The executive’s bonuses were not based on long term returns but on short term profits. These guys made a fat pocket and there was absolutely no accountability built into the system to take care of long term failures. To further worsen issues, Auditors and Rating Agencies that supposed to monitor these companies were not ready to make public, shady dealings of these companies since these companies pay for their services (Raja world’s, 2009). You do not expect a man to bite off the fingers that feeds him.

Securitization also played a major role in spreading financial risks globally. One financial asset, such as debts, were securitized into MBSs (Mortgage Backed Securities) and CDOs (Collateralized Debt Obligations) that were sold to central banks, private banks and wealthy investment funds around the world. Virtually all major financial institutions were involved in creating and selling these products.

U.S. government sponsored enterprises, Fannie Mac and Freddie Mac, were a major source of these risky securities as they were legally required ‘to buy the “bad” subprime mortgage loans created by private lenders’. They owned or guaranteed almost half of the $12 trillion of this debt to central banks and other banks around
the world (Morrow, 2011).

Conclusively, from this essay, the basic cause of the global economic crisis is the imbalance in the U.S. circular flow of income. We can’t blame globalization but we should pondering on ways in which this imbalance can be solved. Global financial crisis could have been averted if all nations are developed. Probably what we will be hearing of will be “U.S. financial crisis” and not a global financial crisis.

This is a lesson to the governments of developing countries.

REFERENCES

• Morrow R. (2011).A critical Analysis of the U.S. Causes of the Global financial crisis of 2007-2008.
  http://blog.heidi-barathieu-brun.ch/wp-archive/5239
• Eklavya (2008). Reasons for Global Recession: In plain simple English.
  http://www.theindianblogger.com/problems/reasons-for-global-recession-in....
  Accessed on 25 08 11
• Global Research (2009). Causes and Solutions to the Global Financial
  Crisis. http://www.globalresearch.ca/index.php?context=va&aid=10792.
  Accessed on 22 08 11
• Raja’s world (2009). Global Financial Crisis - Root Cause.
  http://rajanvenkateswaran.blogspot.com/2009/02/global-financial-crisis-r....
  Accessed on 26 08 11
• Wendell C. (2008). Root causes of the financial crisis: A primer.
  http://www.newgeography.com/content/00369-root-causes-financial-crisis-a....
  Accessed on 26 08 11

Competition Entry | Wie Banken Geld machen Einblicke in ein Schneeballsystem

What are the root causes of the global economic crisis?

Von Tobias Tulinus und Florian Hauschild

Im gesellschaftspolitischen Diskurs sind derzeit aus fast allen politischen Richtungen systemkritische Stimmen zu hören. "Konservative" erkennen dass "Linke" oft Recht hatten, es wird gemahnt und gewarnt, und dass der real existierende Kapitalismus nicht funktioniert, scheint mittlerweile eine Binsenweisheit geworden zu sein.

Dennoch tut die immer breitere Kritik dem derzeitigen EU-Krisenmanagement keinen Abbruch. Die europäische Elite über Merkel bis Sarkozy droht mit dem umstrittenen ESM-Vertragsentwurf das europäische Demokratie- und Transparenzdefizit nicht nur zu zementieren, sondern auch nationalstaatliche Handlungsspielräume weiter einzuschränken, so die Kritiker des so genannten Rettungsschirms.

Auch wenn generell eine koordinierte Wirtschafts- und Finanzpolitik Teil einer Währungsunion sein sollte, stellt sich doch die Frage, unter welchen Voraussetzungen und Kriterien dieser Politikwechsel nun verwirklicht werden soll.

Die öffentliche Debatte über Geld wird derweil unermüdlich geführt, doch woher Geld überhaupt kommt und wie unser Geldsystem funktioniert, wird dabei kaum erörtert. Dass der im Geldsystem verankerte Zinseszins mathematisch bedingt zu einer immer stärkeren Vermögensumverteilung führt, ist unwiderlegt. Kritiker dieser These werden zwar vereinzelt noch laut, lassen sich aber recht leicht widerlegen.

Ein weiterer bedeutender, aber viel seltener diskutierter Fehler im derzeitigen Geldsystem liegt jedoch in der gängigen Praxis der Geldschöpfung. Diese Praxis ist zutiefst ungerecht und undemokratisch. Da es ohne ein demokratisches Geldsystem auf Dauer auch keine funktionierende Demokratie geben kann, soll im Folgenden noch einmal detailliert diese Thematik vertieft werden. Aufbauend auf einem PDF der Bundesbank wird die gängige Giralgeldschöpfung umfangreich dargestellt:

Die Mindestreserve

Eine wichtige Funktion im derzeitigen Geldsystem nimmt die Festlegung einer Mindestreserve der Geschäftsbanken bei der Zentralbank ein. Diese Mindestreserve beträgt im Euroraum 2%. Die Mindestreserve muss von einer Geschäftsbank auf dem eigenen Zentralbankkonto hinterlegt werden - und zwar für das Buchgeld, das die Geschäftsbank auf den Girokonten ihrer Kunden gutgeschrieben hat.

Erzeugung von Buchgeld:

Da eine Bank also nur über 2% der von ihr gebuchten Gelder wirklich verfügen muss, ergibt sich daraus, dass die Bank Geld erzeugen oder auch "schöpfen" kann. Um einen Kredit von 10.000 Euro zu vergeben benötigt die Bank 200 Euro anderweitig nicht benötigtes Guthaben auf ihre Zentralbankkonto.

Verfügt die Bank über diese Rücklage bei der Zentralbank, kann der Kredit an den Kunden direkt vergeben werden: Dem Kunden der Bank werden also einfach 10.000 Euro auf seinem Girokonto gutgeschrieben. Geld das vorher niemand anderes besaß, es wurde durch die Kreditvergabe erst geschöpft, sprich die Information hierüber wird in die Computerdatei des Girokontos geschrieben.

Obwohl die Bank das geschöpfte Geld vor dem Kredit nicht besessen hatte, da es schlichtweg nicht existierte, ist sie nun berechtigt Zins für das neu geschöpfte und zugleich verliehene Geld zu kassieren.

Zu beachten ist auch: Analog zur Erzeugung des Buchgeldes durch Kreditvergabe wird das Buchgeld durch Kreditrückzahlung wieder vernichtet; d.h. würden (in einem theoretischen Moment) tatsächlich alle Kredite zurückgezahlt, gäbe es kein Buchgeld mehr.

Durchführung der Kreditvergabe:

Klassischerweise mussten Kreditnehmer vorweisen "kreditwürdig" zu sein. De facto wurden diese Voraussetzungen jedoch längst außer Kraft gesetzt, da Banken natürlich ein Interesse daran haben immer mehr Schuldner zu erzeugen. Privathaushalte (bspw. im Zuge der Subprime-Kreditvergabe), Unternehmen und schließlich ganze Staaten gerieten und geraten so massenhaft in die Schuldenfalle.

Aber was genau geschieht nun bei der Kreditvergabe von 10.000 Euro an einen Bankkunden? Hier gibt es verschiedene Möglichkeiten:

Fall Eins: Die Geschäftsbank verfügt auf ihrem Zentralbankkonto noch über 200 Euro, als so genannte Überschussreserve. Mit 200 Euro freiem Guthaben auf ihrem Zentralbankkonto kann die Bank wie oben beschrieben 10.000 Euro Kredit vergeben.

Fall Zwei: Die Bank nimmt einen Kredit von der Zentralbank über die 200 Euro auf und vergibt dafür einen Kredit von 10.000 Euro. Dies ist laut dem oben genannten PDF der Bundesbank der Normalfall. Für die 200 Euro zahlt die Bank den Leitzins an die Zentralbank und kassiert den weit höheren Kreditzins über 10.000 Euro vom Kunden.

Fall Drei: Ein anderer Kunde zahlt 205 Euro in bar bei der Bank ein und die Bank bucht die 205 Euro auf ihrem Zentralbankkonto ein. In diesem Fall kann die Bank dann 200 Euro Bargeld als Absicherung für den 10.000-Euro-Kredit benutzen. Die verbliebenen 5 Euro Bargeld reichen als Reserve für bis zu 250 Euro Sichteinlage des Kunden, der die 205 Euro Bargeld eingezahlt hat, welches nun zu Buchgeld auf seinem Girokonto bei der Geschäftsbank geworden ist. In diesem Fall spart die Bank die Zinsen für den 200-Euro-Kredit von der Zentralbank.

Fall Vier: Ein Kunde legt 10.000 Euro Sichteinlagen für mindestens 2 Jahre auf einem Sparbuch fest an. Dieses Geld wird dadurch zur Spareinlage und muss nicht mehr von der Mindestreserve der Bank abgedeckt werden.

Falls der Kunde das Geld allerdings bar abheben will, müsste sich die Bank 10.000 Euro Bargeld besorgen, sofern sie diese gerade nicht im Tresor hat. Das bedeutet, sie müsste im Extremfall weitere 10.000 Euro bei der Zentralbank als Kredit aufnehmen und sich in bar auszahlen lassen.

Wird nun nach der Kreditvergabe der Kredit in Höhe von 10.000 Euro als Bargeld ausgezahlt und bei einer anderen Bank wieder eingezahlt (siehe Fall Drei), könnte diese Bank dann diese Summe wieder bei der Zentralbank hinterlegen, diese 10.000 Euro, die dann wieder Buchgeld sind, mit 200 Euro Bargeld absichern, und die verbleibenden 9.800 Euro Bargeld nutzen, um 490.000 Euro Buchgeld zu schaffen.

Wie viel Geld Banken durch Kredit schöpfen können ist also auch vom Verhalten ihrer Kunden abhängig. Wenn eine Bank viele kleine Privatkunden hat, die relativ viel Bargeld abheben und wenig digitale Geschäfte tätigen wird sie relativ mehr Bargeld brauchen als eine sehr große Geschäftsbank, mit vielen Großkunden, die ihre Geschäfte meist digital abwickeln.

Verhältnis Bargeldmenge zu Buchgeldmenge:

Aus der aufgezeigten Kreditvergabepraxis ergibt sich, dass nur für einen Teil der Buchgeldmenge, Bargeld zum Auszahlen existiert. Dennoch wird von Seiten der Banken versucht, den Eindruck zu erwecken, jeder Kunde könnte jederzeit sein Geld abheben. Es liegt im Interesse der Banken Buchgeld als kongruent zu Bargeld erscheinen zu lassen. Allerdings ist nur Bargeld (also Zentralbankgeld) gesetzliches Zahlungsmittel.

Geschäftsbanken sind darauf angewiesen, dass möglichst viele Geschäfte digital getätigt werden ohne dass echtes Bargeld zum Einsatz kommt, denn eine Geschäftsbank kann nicht beliebig hohe Kredite von der Zentralbank aufnehmen. Diese müssen wiederum besichert sein. Die genauen Geschäftsgebaren zwischen Geschäftsbanken zu Zentralbanken sind jedoch sehr komplex.

Als Kunde kann man die Macht von Geschäftsbanken schmälern in dem man möglichst viel Bargeld vom eigenen Girokonto abhebt.

Tilgung des Kredits:

Da das von Beginn an tot geweihte Buchgeld durch Kreditrückzahlung wieder vernichtet wird, entsteht für die Banken ein Anreiz, die Tilgung zeitlich so weit zu verzögern wie möglich. Die von der Bank vorgeschlagene monatliche Tilgung (=Kreditrückzahlung) ist im Normalfall viel niedriger als der monatlich zu zahlende Zins. Sondertilgungen sind nicht immer möglich. Durch diese vorherige Festlegung wird es dem Kunden unmöglich gemacht, vorzeitig das Kreditverhältnis zu beenden, auch wenn er theoretisch dazu in der Lage wäre. Ziel der Banken ist es, Kunden möglichst lange in der Zinszahlungspflicht zu halten.

Das Zinssystem als weiteres ungerechtes Element des Geldsystems:

Die Erlaubnis für einen "Rohstoff" (Buchgeld), der einfach als digitale Recheneinheit geschaffen wird einen Preis (Zins) kassieren zu dürfen, ist ein Alleinstellungsmerkmal der Banken am Markt. Buchgeld zieht zudem weiteres Geld an. Wer viel hat, bekommt im bestehenden Geldsystem immer noch mehr: Geld das auf Konten oder Sparbüchern geparkt ist und verzinst wird, wird durch die Zinsen mehr und die Gesamtsumme wird dann wiederum verzinst, der so genannte Zinseszinseffekt.

Mathematisch gesehen handelt es sich hierbei um eine Exponentialfunktion: eine Kurve, die erst langsam ansteigt aber nach einigen Jahrzehnten regelrecht nach oben "explodiert". Beispiele zur Berechnung von Zins und Zinseszins gibt es hier.

Wer hingegen verschuldet ist, muss nicht nur seine Schuld abtragen, sondern auch noch die Zinsen für seinen Kredit finanzieren. Zu beachten gilt dabei auch, dass die "vollen" Konten der Einen das Rückzahlen der Schulden der Anderen erschweren bzw. unmöglich machen.

Wie oben aufgezeigt entsteht Buchgeld als Schuld. Wird Buchgeld auf einem Konto gespart und nicht mehr ausgegeben, muss die Buchgeldmenge also weiter erhöht werden, damit überhaupt an anderer Stelle die laufenden Kredite (=Schulden) bedient werden können. Dies führt zu immer neuen Schulden.

Auch die Tatsache, dass der Zins in der geschöpften Kreditbuchgeldmenge nie enthalten sein kann, führt zu immer neuen Schulden.

Der Zins muss entweder der bereits vorhandenen Geldmenge anderer Marktteilnehmer entnommen werden, oder aber wiederum durch neue Kredite finanziert werden (entweder vom Kreditnehmer selbst, oder von anderen Markteilnehmern, die ihrerseits im Wirtschaftsprozess den Beispielkreditnehmer bezahlen). Ein klassisches Schneeballsystem.

Sonderfall der Buchgeldschöpfung:

Es wird immer wieder behauptet, Banken könnten nicht einfach für sich selbst Buchgeld erschaffen. Die Bundesbank widerspricht dem eindeutig:

Zitat Bundesbank-PDF Seite 72:

"Auch kann die Geschäftsbank den Ankauf eines Vermögenswerts durch Gutschrift des Kaufbetrags auf dem Konto des Verkäufers bezahlen. Sie ist dann Eigentümerin des Vermögenswerts. Das kann beispielsweise eine Immobilie sein, die sie selbst nutzt oder die laufend Mietertrag abwirft. Bezahlt bzw. finanziert hat sie diese Immobilie mit selbst geschaffenem Giralgeld."

Fazit:

Die Buchgeldmengensteuerung über eine Mindestreserve von nur 2% (USA 10%, China 21%) bietet Banken den Ausgangspunkt zum Schaffen von neuem Geld.

Die Entstehung des Geldes als Schuld (also als laufender Kredit für den Zinsen zu entrichten sind) gepaart mit ungleicher Verteilung desselben, sorgt ebenfalls für immer neue Schulden. Hinzu kommt die Geldmenge der Zinsen, die als Preis der Buchgeldmenge nicht in ebendieser Buchgeldmenge enthalten sein kann, und somit wiederum nach Finanzierung über neue Schulden verlangt.

Mit einem solchen Blick auf die uns oft verborgenen Mechanismen im Geldsystem, lässt sich schließlich auch die Entstehung des modernen Finanzkapitalismus miterklären. Die riesigen Buchgeldmengen schreien nach Anlagemöglichkeiten. Dies ist, neben anderem, ein Grund für die Entwicklung von immer neuen Finanz"produkten".

Die Kreditvergabe durch Buchgeld dreht die entstehenden Anreize, im Vergleich zu einer Kreditvergabe aus Bargeld zwischen zwei Privatpersonen, regelrecht um: Normalerweise hätte ein Kreditgeber Interesse daran, sein Geld möglichst schnell zurück zu bekommen, weil er tatsächlich in der Zeit des laufenden Kredites darauf verzichtet, mit seinem Geld zu wirtschaften. Da Buchgeld durch Rückzahlung vernichtet wird und die Rückzahlung einfach nur das Ende des Zinsgeschäftes bedeutet, ist es im Fall der Geschäftsbanken umgekehrt.

Aus demokratietheoretischer Sicht muss das bestehende System der Buchgeldschöpfung scharf verurteilt werden, denn es handelt sich hierbei um ein oligarchisches Herrschaftsverhältnis. Als eine erste Notfallmaßnahme soll hier vorgeschlagen werden, die Lizenz zum Erschaffen von Buchgeld den Geschäftsbanken zu entziehen und in die Hände des Staates - sprich einer demokratisch organisierten Gesellschaft - zu legen.

Ebenfalls ist es möglich, parallel zum jetzigen Geldsystem, neue, basisdemokratische, kommunale, öffentliche Geldsysteme zu etablieren. Zahlreiche funktionierende Regiogelder existieren bereits. Hier ein Beispiel aus Deutschland und eines aus Brasilien.

Nach demokratietheoretischen Gesichtspunkten ergeben sich hierbei folgende Fragen:

Wieso hat der Staat Privatbanken die Lizenz zur Geldschöpfung übertragen? Die direkte Vergabe von Krediten an die öffentliche Hand durch die Zentralbank ist im Euroraum seit der zweiten Stufe der Europäischen Währungsunion von 1994 verboten, d. h. der Staat muss sich Geld bei Geschäftsbanken bzw. am Rentenmarkt leihen.

Wieso verschuldet sich der Staat - also wir alle - bei Privatbanken in Geldeinheiten, die diese schöpfen?

Wieso wird das Bereitstellen eines funktionierenden Geldsystems als größtenteils private und nicht als öffentliche Aufgabe betrachtet?

Wieso gibt es keine kommunalen, öffentlichen Banken, die ebenfalls Geld schöpfen dürften?

Die Auseinandersetzung mit diesen Fragen führen zu einer weiteren, entscheidenden Frage: Nämlich wie ohne ein demokratisches, gerechtes Geldsystem ein demokratisches politisches System und eine stabile Wirtschaftsordnung möglich sein soll. Die Frage, ob wir in einer Demokratie oder unter einer Diktatur der Finanzmärkte leben wollen, hängt zentral von der Art des Geldsystems ab, das wir nutzen.

Competition Winner | Imperium ex Nihilo

What are the root causes of the global economic crisis?

Authored by JP Orient

Abstract: This analysis argues that today's financial crisis is driven by computational heuristics, discoveries made by machines, to find logical rationales for maintaining moribund power structures. Rather than using computational heuristics to lead societies toward a world in which people desire to co-exist, the essay shows how vested interests have used machines to dictate and defend corroding centers of power. The result is an Imperium ex Nihilo, an "Empire Out of Nothing" but the assumptions of man inside the narrow focus of profit and greed.

Today's financial crisis can be analyzed through an array of lenses. In the narrowest, it is the capitulation of Keynesian economics to social conservatism emboldened by concentrated wealth. In the broadest, it represents lost trust in societies that delivered some of mankind's greatest social achievements: Enlightenment, Scientific Method, Democracy and Human Rights. Through an ecological lens we might see it as a resource-limitation shadow cast upon an ailing Earth. Militarily we may someday see the crisis as the product of imperial overreach. Commercially it could be scrutinized as a corporatist revolt, whereby organized interests overthrew the state in managing the world's tenuous plenty behind fortified castles of capital.

However history's kaleidoscope is used to see the crisis, it will be observed that the designers all used the same weapon in its proliferation: machines built to think for them.[1]

By focusing the lens on the tools of its making, today's financial crisis is seen as the betrayal of the promise that man-computer symbiosis once held. The betrayal is not wholly unexpected. Networked computing from the onset was funded and designed primarily as a tool for waging war. Its first civilian incarnation was conservative to the core. Banks used the innovation to preserve the profitability of accumulating ever more capital by reducing worker costs deployed to count wealth.

"We slaved in our underwear, in an un-air-conditioned bank vault, with an occasional six-pack of beer to make it more bearable. Every afternoon, we counted out billions of dollars of actual bond and stock certificates to be messengered to banks as collateral for overnight loans. Then, every morning, when those certificates needed for delivery to customers were returned by a group of disheveled old men who blanketed the streets of lower Manhattan carrying "bearer" bonds and stocks door-to-door, we checked them back into the firms inventory."[2]

That tale of squandered youth was written by a costly 24-year-old Harvard University MBA who toiled beneath the of boilers of Solomon Brother's in 1966. His name was Michael Bloomberg. Fortunately for him, one year earlier Bank of America had hired a 42-year-old German mathematician, whose family had escaped their country's Holocaust, to alleviate the burdens of young financiers by writing a computer program to help balance the books.

"There were many very hard technical problems. It was a whale of a lot of fun attacking those hard problems, and it never occurred to me at the time that I was cooperating in a technological venture which had certain social side effects which I might come to regret. That never occurred to me. I was totally wrapped up in my identity as a professional and besides, it was just too much fun."[3]

Joseph Weizenbaum, the artificial intelligence pioneer who created, what appeared to some, a sentient machine program, ELIZA, was later recognized for his warnings that technical innovations may come at the expense of social evolution. They prop-up decaying power. Michael Bloomberg saw profit through innovation, and when released from his Solomon bond in 1981 with a $10 million check, set off to rejuvenate moribund U.S. banking with network computing.

"I would start a company that would help financial organizations ... When it came to knowing the relative value of one security versus another, most of Wall Street in 1981 had pretty much remained where it was when I began as a clerk back in the mid-1960s: a bunch of guys using No. 2 pencils, chronicling the seat-of-the-pants guesses of too many bored traders. Something that could show instantly whether government bonds were appreciating at a faster rate than corporate bonds would make smart investors out of mediocre ones, and would create an enormous competitive advantage over anyone lacking these capabilities. At a time when the U.S. budget deficit (financed by billions of dollars of new Treasury bonds and notes) was poised to explode, such a device would appeal to everyone working in finance, securities and investments..."[4]

The young investment-banking Bloomberg realized his vision and today sits atop the world's financial capital, mayor of New York and owner of the highly valuable and systemically important company bearing his name. Weizenbaum spent the last 14-years of his life in Berlin after returning disillusioned from Cambridge, MA in 1996. His ideas were documented in a film, "Plug and Pray."[5]

Source: U.S. Federal Reserve data and publicly available data on Bloomberg L.P. installations.

Bloomberg, along with other computer-aided trading and analytical networks that formed in the 1980s, benefited from more than expansionary U.S. fiscal policy. Computer processing-power costs fell, resulting in more machines inside of decision-making organizations. At the same time, computer scientists began to revolutionize software logic.

The science of heuristics -- problem-solving strategies using "rules of thumb" and intuitive guessing to detect patterns inside complex systems -- began to subsume deep modeling as a computational method to aid decision making. Whereas early network designers envisioned men using computers to deepen and refine meaning about well-understood systemic phenomena, new computational techniques ordered computers to detect patterns and meaning from seemingly incomprehensible data.[6]

Greece is ironically the etymological origin of the computational logic that financial networks tell us will be the country's ultimate demise. Heuristic is derived from the Greek word to "find" or "discover." Its root is most commonly illustrated with the story about the mathematician Archimedes who ran naked from his bathtub crying "Eureka" after solving a vexing problem. Heuristic problem-solving strategies use "fuzzy logic," "swarm intelligence" and "tabu search" algorithms. They are techniques that intuit patterns without complete information.

By the early 1980s the quintessentially human domain of seeing meaning inside the patterns of complex systems, had given way to "neural," "greedy random" and "adaptive" computer networks that identified the patterns for us. The supreme confidence in this new form of man-computer symbiosis can be glinted in the recorded tirade of Matthew Winkler, the young Wall Street Journal reporter Michael Bloomberg hired to become the public face for his financial network.

"No!" Winkler yells at a journalist who faulted a machine for an error in his reporting. "The enemy was not the computer. That's wrong. Excuse me! The enemy was not the computer. That's why we are having this meeting. I figured that a lot of you were going to think this way. It's wrong! It's not the computer, it's the human!"[7]

Caption: Mathew Winkler and Michael Bloomberg on the inside cover of "Bloomberg by Bloomberg," 1997.

Bloomberg, and similarly operated computer networks, publish the stories of machines rather than those of men. Their society has ceased to trust the discoveries, the heuristics, of man and instead turned to those calculated by machines. The result is a devastating cognitive dissonance that threatens the resiliency of societies, those patterns manifest by the fastest, deepest and most flexible processing capacity that, at times, graces the Earth: us.

Even the Defense Advance Research Project Agency, or DARPA, which funded the decades of basic research that created Internet Protocol, says that the new generation of U.S. tax-payer funded computers are a long distance from matching the human mind's raw processing power.

“We have no computers today that can begin to approach the awesome power of the human mind. A computer comparable to the human brain would need to be able to perform more than 38 thousand trillion operations per second and hold about 3,584 terabytes of memory. (IBM’s BlueGene supercomputer, one of the worlds’ most powerful, has a computational capability of 92 trillion operations per second and 8 terabytes of storage.)"[8]

It is well understood and acknowledged that languages written by man for computers necessarily contain the assumptions and biases of their authors. The "Subjective Expected Utility" model, which "defines the conditions of perfect utility-maximizing rationality in a world of certainty," has been central to economic dogma, according to a 1986 National Academy of Sciences report.[9] One of the fatal, utterly trod upon and discredited assumptions underlying virtually every financial-software heuristic is that men can be relied upon to make rational decisions.

We are reminded of the moment in "The Great Dictator" when Charlie Chaplin cries out to the soldiers "you are not machines!"[10] People experience shame. They feel guilt. They exercise compassion and love. People foment rebellion.

Our financial crisis is driven by computational heuristics, discoveries made by machines to find logical rationales for maintaining moribund power structures. Rather than using computational heuristics to lead us to a world where we want to live, societies have allowed machines to dictate and defend corroding and corrupt centers of power.

As an aside, it is noteworthy to observe how quaint the U.S. State Department cables released by Wikileaks look compared to the finance-driven headlines that define our present crisis. It is somehow touching the way U.S. public servants exercise humor, wit and drama to convey the humanity of actors balancing the scales of international order. Meta-word searches of the cables nevertheless do provide some insight into the direction our world is spinning:

• The preparation for and prevention of "war" is mentioned three times for every two that the maintenance of international "peace" is discussed.[11]
• While "Chinese" slightly overcomes "English," the focus on "Europe" surpasses "Asia" by about two-fifths.[12]
• "Democracy" is being trounced by the "bank" while "human rights" outweigh "gold" by a wide margin.[13]
• "Baseball," "Basketball," "Cricket" and "Rugby" cannot team up to match "Soccer" as a source of lively conversation around the world.[14]

The cables released by Wikileaks will keep the heuristic machines humming for a long time while they grind and churn new strategies to increase yield, extract rent, maximize profit and maintain power.

But what about the rest of us? Who among our elected leaders will speak clearly the human vision and show their guts, to man and woman alike, by exercising compassion? Who will program our machines to search for the elusive path leading to the place where peace and security overcome violence and mistrust?

Ours is an Imperium ex Nihilo, an "Empire Out of Nothing" but the assumptions of man inside the narrow focus of profit and greed. There are technical remedies that may temporarily ease the suffering that is a byproduct of machine-driven economic discoveries.[15] However in the end, we must start the long and arduous task of re-programming them to work for us, to help us see the patterns in the societies that we desire.

Our machine-made heuristics have been misappropriated. Rather than being used to minimize the risks men face in their time on Earth, they have been taken by a narrow band of craven elites who reap greater profit from the instability their discoveries sow. It is time for a clear voice human voice to say enough and bring us back into balanced alignment with our creations.

Let machine-made heuristics discover better ways to direct city traffic, guide craft in flight, and safeguard man's most deadly creation, nuclear weapons.[16]Grant them allowance to find efficiencies, safety and security. Computational heuristics can be powerful in the hands of men who know where they want to go. They are deadly inside the feckless culture of bullying that characterizes our financial institutions.

Wresting these most powerful tools of reasoning away from society's vested elites will not be easy but it is within reach. They will try to spin the counterforce of human progress against those who try. Fear. Hate. Intolerance. Nationalism. The vested elites who deploy computational heuristics, the discoveries of machines, to amass wealth have shown they are willing to support war, to turn their eyes to torture and bury habeas corpus when it is necessary to protected themselves. It will not be easy and it will not happen until humanity is exercised.

For inspiration and in parting, we might look no further than to the roots of networked computing, to the visionary JCR Licklider, who conceived of the Internet as we know it and dreamed of a day when:

"Unemployment would disappear from the face of the earth forever, for consider the magnitude of the task of adapting the network's software to all the new generations of computer, coming closer and closer upon the heels of their predecessors until the entire population of the world is caught up in an infinite crescendo of on-line interactive debugging."[17]

When at last our financial crisis is over and they finally come home, we should try to be kind to the underwear-clad bankers returning to toil by the boilers alongside the rest of us. May they bring beer.

------------------------------

[1] Technically, we may refer to these machines as "heuristically or meta-heuristically programmed computing networks"

[2] Bloomberg, Michael, "Bloomberg by Bloomberg," John Wiley & Sons, New York, 1997, page 23.

[3] ben-Aaron, Diana, "Weizenbaum examines computers and society," M.I.T.'s The Tech, Volume 105, Issue 16, April 9, 1985 (http://tech.mit.edu/V105/PDF/N16.pdf)

[4] Bloomberg, Michael, "Bloomberg by Bloomberg," pages 41-42.

[5] "Plug & Pray," 2010 http://www.imdb.com/title/tt1692889/

[6] For an exhaustive computational heuristics biography, Osman, Ibrahim H. & Laporte, Gilbert, " Metaheuristics: A bibliography" Institute of Mathematics and Statistics, University of Kent (http://sb.aub.edu.lb/PersonalSites/DrOsman/docs/Articles%20-%20pdf/BIBmh...)

For an example of applied computational heuristics, see: *Draft of *L. Ingber, M.F. Wehner, G.M. Jabbour, and T.M. Barnhill, “Application of statistical mechanics methodology to term-structure bond-pricing models,” *Mathl. Comput. Modeling *15 (11), 1991, pp. 77-98. (http://www.ingber.com/markets91_interest.pdf)

For a discussion of neural network application in finance, see: Wallace, Martin P., NEURAL NETWORKS AND THEIR APPLICATION TO FINANCE, Applied Technologies Centre, London, U.K. 2008 (http://www.saycocorporativo.com/saycoUK/BIJ/journal/Vol1No1/article_3.pdf)

For the definition of heuristics as a scientific discipline, see; Lenat, Douglas B., "The Nature of Heuristics," Xerox, Palo Alto Research Center, 1981 (http://www.bitsavers.org/pdf/xerox/parc/techReports/SSL-81-1_The_Nature_...)

[7] http://gawker.com/5002235/the-enemy-is-the-human

[8] Greenmeier, Larry, "Computers have a Lot to Learn from the Human Brain," Scientific American, March 10, 2009, http://www.scientificamerican.com/blog/post.cfm?id=computers-have-a-lot-...

[9] Simon, Herbert A.,"Decision Making and Problem Solving,"National Academy of Sciences, National Academy of Engineering, Institute of Medicine, 1986, http://www.nap.edu/openbook.php?record_id=911&page=19

[10] http://www.youtube.com/watch?v=QcvjoWOwnn4

[11] Http://www.cablegatesearch.net search for "war" on August 28, 2011 yielded 38,882 returns. The search for "peace" yielded 26,379 hits.

[12] Http://www.cablegatesearch.net search for "Chinese" on August 28, 2011 yielded 9,865; English yielded 9,417; Europe yielded 31,767; Asia yielded
18,957.

[13] Http://www.cablegatesearch.net search for "Democracy" on August 28, 2011 yielded 12,304; "Bank" yielded 26,877; "Human Rights" yielded 38,452;
"Gold" yielded 6,024.

[14] Http://www.cablegatesearch.net search for "Baseball" on August 28, 2011 yielded 247; "basketball" yielded 203; "rugby" yielded 34; "Soccer" yielded 918.

[15] This analysis does not endeavor to explore the remedies for fixing our financial crisis. For further study, UNCTAD has consistently recommended currency controls as a counter-weight to financial innovation (http://www.unctad.org/en/docs/tdr2010_en.pdf). The May 2010 "flash crash," resulting in the DJIA's biggest intraday drop, was triggered by automated, high-frequency trading programs which warrant regulatory scrutiny and oversight. At the very least, and in keeping with the spirit of the cooperative, deep-modeling that computers enable, the commands and assumptions embedded in heuristic trading algorithms should be made public through SEC or other filings. Finally, for a more traditional approach, increasing the marginal tax rate on the most highly-paid workers may encourage the physicists and computer scientists creating bank models to seek more worthwhile employment.

[16] Clarke, L.B. 1993. The Disqualification Heuristic: When do Organizations Misperceive Risk? Research in Social Problems and Public Policy 5:289-312.

[17] Licklider, JCR, "The Computer as a Communications Device," Science and Technology, 1968 (http://sloan.stanford.edu/mousesite/Secondary/Licklider.pdf)